Reference no: EM132579182

The declaration by the World Health Organization (WHO) that the coronavirus, or COVID-19, a global pandemic, affecting many companies including TaraTera Bhd (TTB). TTB is in poultry farming of Brahma chicken since the year 2015 with financial year ending in June. Due to the fall in demand, chicken prices drop, and the poultry industry affected. As a result, starting from 31 December 2019, chicken price is available at their net value of RM5.00 per unit in retail compared with RM12.00 per unit earlier before the outbreak. However, the market value for chicks remains the same. Earlier, on 31 October 2019, all chickens from the opening record were entirely sold at RM15 per unit. TTB only sell chicken above one year old to retailers. On 1 July 2019, TTB had the following poultry stocks:

                                          Quantity               Fair value per unit (RM)               Cost to sell per unit (RM)

Chicks (below 1 year old)           20,000                        10                                          2

Chicken (above 1 year old)               40,000                     15                                       3

• Literally, the chicks will become chicken at the date of reporting 2020 On 30 June 2020, in order to contain the outbreak and reduce the excess poultry in the farm, TTB destroyed all chicken and only left the chicks to grow. At this date, the number of newly breed chicks was double than the beginning record. The Malaysian government is offering loans of RM80,000 to all affecting companies to keep the country's economy afloat amid the growing coronavirus crisis. The loan will be converted to compensation in stages for two years, at each reporting date if the company fulfil the requirement to continue the operation without any staff termination. TTB has obtained the loan on 1 January 2020 and striving to meet those requirements which were fulfilled as at the date of reporting.

REQUIRED:

Question (a) all journal entries for the transactions in the financial year end 2020 for TaraTera Bhd.

Question (b) TaraTera Bhd is planning to acquire a piece of plantation land to expand its agriculture activities due to worsen economic condition of poultry farm. However, the market value available is for both land and the plants. Explain how to determine the fair value of the biological assets to TaraTera Bhd according to MFRS 141 Agriculture