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CH. 25 Example 3–PUP

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › CH. 25 Example 3–PUP

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  • July 16, 2021 at 6:26 am #627887
    sherlock221B
    Participant
    • Topics: 15
    • Replies: 2
    • ☆

    Sir,

    In this example, the Associate (BF) sells goods to the Parent (TR). The answer is given as D. Why is answer C incorrect?

    Thank you

    July 17, 2021 at 8:35 pm #628096
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7163
    • ☆☆☆☆☆

    Hi,

    The direction of the sale is not taken into account for a PUP between the group and the associate using equity accounting. We will always process the PUP as shown in the class notes, where the credit is to the investment in associate.

    Thanks

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