Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › JUNE 2015
- This topic has 3 replies, 2 voices, and was last updated 8 years ago by MikeLittle.
- AuthorPosts
- June 21, 2015 at 11:26 pm #258453
hello Sirt
Johnson paid $1·2 million for a 30% investment in Treem’s equity shares on 1 August 2014.
Treem’s profit after tax for the year ended 31 March 2015 was $750,000. On 31 March 2015, Treem had $300,000
goods in its inventory which it had bought from Johnson in March 2015. These had been sold by Johnson at a
mark-up on cost of 20%. Treem has not paid any dividends.
On the assumption that Treem is an associate of Johnson, what would be the carrying amount of the investment
in Treem in the consolidated statement of financial position of Johnson as at 31 March 2015?
A $1,335,000
B $1,332,000
C $1,300,000
D $1,410,000I keep having this
consideration 1200
post acquisition (500X30%)
less PUP 300×20/120June 22, 2015 at 9:32 pm #258537So, you’re arriving at answer C?
June 22, 2015 at 9:52 pm #258543yes Sir. I got C
June 22, 2015 at 10:16 pm #258547You have treated the pup incorrectly. You have calculated it correctly but, for an associate, you only eliminate the GROUP’S share of the pup ie the adjustment is for only 30% x $50,000
Ok?
- AuthorPosts
- You must be logged in to reply to this topic.