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X Co acquired 80% of the e q uity share capital in Y Co on 31 July 20X6. Extracts from the two companies’ statements of profit or loss for the year ended 30 September 20X6 were as follows:
X Co Y Co
$’000 $’000
Revenue 3 400 2 400
Cost of sales 1 500 1 800During the year ended 30 September 20X6, Y Co sold goods for $5 000 each month to X Co, at a mark up of 25%. At the end of the year X Co had 50% of these goods left in inventory.
What is the group gross profit for the year ended 30 September 20X6?
Please do not simply type out test questions and expect me to provide you with an answer.
You must have an answer in the same book in which you found the question, and so you should ask about whatever it is in the answer that you are not clear about – then I will explain.
Have you watched my free lectures? Everything needed to answer this question is explained, with examples, in my lectures.
The lectures are a complete free course for Paper FA (F3) and cover everything needed to be able to pass the exam well.
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