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like my reporting date retained earning at acquisition date are 14300 and at reporting date are 12000
so total of net assets are at acquisition 22300 and at reporting 19900-19900+22300= -2400
so my answer of post acquisition did not match with standard answer because they have post acquisition losses of 3000
yes why there is difference in my post acquisition losses and what I am doing wrong in question so that makes the difference?
sorry if I didn’t explain my question well to you.
this is my first time here to ask question.The loss is $4,600 for the year and the post-acquisition element of that is 6/12 = $2,300
The fair value adjustment to the leased property (note (i) in the question) means that there should be an additional charge for depreciation on the fair value increase. So $2m / 10 x 6/12 = 100,000 additional depreciation to increase that loss to $2,400
Then there’s the pup on the unsold inventory that works out to $600 and this too is to be adjusted in Southstar’s post-acquisition retained earnings and takes the figure now to $3,000 loss in the second half (the post-acquisition half) of the year
OK?
sir here is another qustion
cavern
$000
equity shares of 20 cents each note 1 50000(1) cavern has accounted for fully subscribed right issue of equity shares made on 1 april 2010 of one new share of every four share in issue at 42 cents each
llama
$000
equity share of 50 cents each fully paid 60000
suspense account note 4 24000(4)the suspense account contains the corresponding entry for the proceeds of right issue of share made on 1 july 2007.the term of the issue were one share for every four held at 80 cents per share.
1 for 4 is common in both questions
but it is solved differentlycavern solution llama solution
50000/.20=250000 60000/.50=120000
250000*1/5=50000 120000*1/4=30000
my question is why are we taking 1 by 4 in llama.it should be 1by 5 because if a person has four shares before issue so after issue he should have five like shown in cavern.
sir tell me what I am misunderstanding in this?In Cavern the rights issue has already been correctly entered so 50,000 is AFTER accounting for the 1 for 4
In Llama the rights issue has not yet been accounted for – the correct credit entries are in the Suspense account and need to be adjusted
OK?
yes ,i understood sir.the difference is that in llama it was not accounted for.thanks
sir i studied f8 in last session june attempt bit i didn’t appear in exam now i am sitting in dec for f7 and f8.my f7 is going well i almostly covered cosolidation and ias 1 ,remaining part is statement of cash flows and interpretations.on other side i didnt started study f8. i am planning to start it after completing my two main topics in f7.what would you suggest me.your experienced advice must be appreciated allot.
thanks to you and opentuition that they are assisting us in a good way
I would start reading the revision kit for F8 pretty soon. Maybe spend 2 hours on F7 and then 1 hour on F8
But I wouldn’t leave it much longer before you start
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