Forums › ACCA Forums › ACCA FA Financial Accounting Forums › Consolidate statement of financial position
- This topic has 2 replies, 2 voices, and was last updated 10 years ago by gabbi08.
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- February 23, 2014 at 6:08 pm #159886
Hi
Just a quick question to clarify one point.
If in the consolidated financial statement P sold good to S and it is not specify that S and the question does not specify that the goods hasn’t been paid, should I deduct the amount from receivable and payable or not.In the question that I am working on is given:
During the year P sold goods to S for 30,000 making a gross profit margin on the sale of 30%.One third of this goods still included in the inventories of S.
In the consolidated financial statement the total of receivable and payable are not deducted of 30000. Is it correct?
My understanding was that if there is an intra sale between two company the amount of sale has to be deducted from receivable and payable
Thanks
Gabbi
February 23, 2014 at 7:44 pm #159891Hi
Interco sales and purchases need to be eliminiated but not payables and receivables unless it states there are balances outstanding.
If my memory serves me correctly unrealised profit needs to be adjusted too but please check. I’ve not got my study head on yet.
February 23, 2014 at 8:25 pm #159896Hi Pippa,
Thanks for replying to my question.
It makes sense that the receivables and payables need to be eliminated only if it states that are outstanding.Gabbi
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