[acca2021yasemin]

thank you very much!

[acca2021yasemin]

hi Tutor, can u pls help me with the below question:
Polestar OTQ case;

Q: What is the amount of the adjustment to profit attributable to the non-controlling interest in respect of unrealized profit

(iii) Polestar sold materials at their cost of $4 million to Southstar Co in June 20X3. Southstar Co processed all of these materials at an additional cost of $1.4 million and sold them back to Polestar Co in August 20X3 for $9 million. At 30 September 20X3 Polestar Co had $1.5 million of these goods still in inventory. There were no other intragroup sales

the solutions says: which i don’t understand
Unrealised Profit= 9m -5.4m = 3.6 m which i get but i dont follow from here:

still in inventory = 3.6 m x 1.5 / 9 = 600,000 x 25% = 150,000 Answer

pls help.

Thanks
Yasemin

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