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Advanced accounting 2

Galoe is a publicly traded company and is currenty preparing the interim financial data that it will issme to its shaholders and the Securities Commission at the end of the first quarter of its December 31,2022 fiscal year. The following items need to be congidered: 1. At the end of the first quarter, the company spent $1.1 million for magaaine advertising as a lump sum payment for 52 weeks. The ads will appear in weekly issues of the magaaine until March 31, 2023. The company has decided it will recognize 1/4 of the costs in each quarter of the current December 31,2022 year. 2. Also included in variable selling costs is one quarter of an equipment repair cost that had a total cost of 2.25 million to be carried out in the last quarter of the year. 3. Inventory is carried on the books at a cost of $693,000. Net realizable value was determined at $535,500. Chloe anticipates that this will reverse before the third quarter is complete and as a result inventory remains at cost. 4. According to their contract, management will be paid a bonus of 1/2% of profits above 15 million before tax. The company estimates that profit will reach 30 million for the year. The company's average tax rate is 35%. Chloe must issue its quarterly financial statements in accordance with IFRS IAS 34 regarding interim financial reporting. Inatructions (a) Explain whether Chloe should report its operating resulte for the quarter as if the quarter were an entirely separate reporting period or as if the quarter wete an integral part of the annual reporting period. (b) State how the above items would be reflected in Chlos i quarterly report prepared for the Irat quarter of the 2022 fical year. Briefly juitify your decision and shorn calculations or hom the umeumt trovid be caleulateri. Galoe is a publicly traded company and is currenty preparing the interim financial data that it will issme to its shaholders and the Securities Commission at the end of the first quarter of its December 31,2022 fiscal year. The following items need to be congidered: 1. At the end of the first quarter, the company spent $1.1 million for magaaine advertising as a lump sum payment for 52 weeks. The ads will appear in weekly issues of the magaaine until March 31, 2023. The company has decided it will recognize 1/4 of the costs in each quarter of the current December 31,2022 year. 2. Also included in variable selling costs is one quarter of an equipment repair cost that had a total cost of 2.25 million to be carried out in the last quarter of the year. 3. Inventory is carried on the books at a cost of $693,000. Net realizable value was determined at $535,500. Chloe anticipates that this will reverse before the third quarter is complete and as a result inventory remains at cost. 4. According to their contract, management will be paid a bonus of 1/2% of profits above 15 million before tax. The company estimates that profit will reach 30 million for the year. The company's average tax rate is 35%. Chloe must issue its quarterly financial statements in accordance with IFRS IAS 34 regarding interim financial reporting. Inatructions (a) Explain whether Chloe should report its operating resulte for the quarter as if the quarter were an entirely separate reporting period or as if the quarter wete an integral part of the annual reporting period. (b) State how the above items would be reflected in Chlos i quarterly report prepared for the Irat quarter of the 2022 fical year. Briefly juitify your decision and shorn calculations or hom the umeumt trovid be caleulateri

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