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Hi,
With respect to assets held for sale; when you classify as held for sale do you:
– first charge depreciation up to date we decide to sell
– then value at lower of CV and FT-CTS
Or is it the other way around please?I am asking as in my notes its stated that way with depreciation first, however when I worked ‘Lateral’ from December 2005 it does it the other way :s.
Thanks
It should be 1) deal with the depreciation first and then 2) sort out the fair value situation.
I don’t know why Lateral does it in apparent reverse
Sir in the lateral qs,an ahfs was sold by sub to parent after yr end,do we still adjust pup in the net assets working?
Thanks
Hasan – I get the repeated impression that you’re testing me. Is there a problem for you to check these things out for yourself from a textbook, an alternative text book, the IFRS itself, Deloittes IASPLUS publication? Surely there is enough on the internet that you could do your own research.
I promise im not testing u.Im confused as kaplan is inconsistent.I appreciate your response
Hello
In the answer to this question, i do not understand the fair value adjustment working which shows an acquisition amount of 90 and ends with 57.6. Could you please start by explaining where the 90 came from and then proceed to the movement which eventually gives the 57.6?
Thanks.Hi,
We are told that the retained earnings at acquisition are $210m and the share capital is $500m, which combined gives us $710m. We’re given the fair value of the net assets of $800m, so therefore the difference of $90m is the fair value adjustment that is referred to in the additional information.
The fair value adjustment is the depreciated 20% reducing balance over the following two years to give the carrying value of $57.6m.
Hope this helps.
Thanks
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