1500 words for Advanced Financial Accounting essay

1. The essay requires 1500 words
2. In total it needs at least 12 references with Harvard style.
3. If answering the questions need to calculate, please do remember to write down the calculation process.
4. Below are two questions, please answer all of them.
5. I have attached the essay requirement doc, please read thoroughly.
6. I will email the support team about the lecture ppt, please read if needed.

Assignment:
This assignment consists of two questions.
Candidates should answer all parts of all questions.
Question 1 [50 marks]
Worldwide Fuels, a public limited company, is preparing its financial statements for the
year ending 31 December 2020. The exhibits contain information relevant to the
question.
Exhibit 1 – Construction of energy generating facility
On 1 February 2020 Worldwide Fuels started the construction of an energy generating
facility. The following costs were incurred during the construction:
£000
Freehold land 1,500
Site preparation 725
Materials 3,500
Direct labour costs 8,250
Legal fees 1,000
General overheads 575
To aid construction of the energy generating facility, Worldwide Fuels issued a £10
million unsecured loan on 1 February 2020. The loan carried an interest rate of 15%
per annum and is repayable on 1 February 2025. On 30 June 2020, Worldwide Fuels
finalised the construction of the energy generating facility. The facility was brought into
use on 1 August 2020. The facility has an expected useful economic life of 30 years
and that will have no residual value at that date. Worldwide Fuels uses the straight-line method for calculating depreciation. Worldwide Fuels has a legal requirement to
decommission the facility at the end of its estimated useful life. The directors of
Worldwide Fuels estimated the costs of this decommissioning to be £32 million –
based on prices prevailing at 30 June 2050. At an appropriate discount rate the present
value of the cost of decommissioning the facility is £9 million.
Exhibit 2 – Research

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