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I got 51%! I was so ready to have to resit this December. All glory to God! Still pleasantly surprised.
Thank you, but I mean will the probability of it occurring be taken into consideration when calculating?
This is what informs my question:
‘Additionally, cash of $18 million was due to be paid on 1 January 20X9 if the net pro t after tax of Grape grew by 5% in each of the two years following acquisition. The present value of the total contingent consideration at 1 January 20X7 was $16 million. It was felt that there was a 25% chance of the profit target being met.’
Will this be recognized in the goodwill calculation as $16m or as $4m ($16m x 25%)?
Well, I pro rated it because the period wasn’t up to a year and the premium is paid for each year. I thought it was a 10 year lease, though. That’s what I saw.
I totally forgot about the ‘expenses incurred 7-years before the business starts are deductible’ rule.
Was the advertising expenditure supposed to be subtracted to increase the operating loss of the company? I felt it shouldn’t since it wasn’t incurred in that period. And did anyone time apportion the lease paid by the company?
@gavin23 said:
I don’t think whether the car is new or second hand matters for FYA … wonder if it should be time proportioned though as the write down in 100%The computer probably qualify as AIA but I don’t think I used it.
I allowed all of the moving expenses and medical expenses … think there was a past question with similar figures so don’t think either were over the limit if they both employment related.
I read in my BPP study pack that it DOES matter if the car was new or second hand.
@ritaalbu said:
Section C, Q31, amount of max additional contribution 94K, as max is relevant net earnings, and 62K c/f in 2016-17? and max limit for ISAs 15,240 (didnt time apportion it as the limit is annual, therefore he could invest max in 30 days, but nothing afterwards?)I think the ISA answer was £30480 (15240*2) They told us to assume the day was 15th of March and he wanted to know how much to contribute in the next 30 days. He could contribute the first £15240 for the 15th March to 5th of April for the 2015/2016 tax year (since he hadn’t already done so before) and the second £15240 for 6th April to the end of the 30 days for the 2016/2017 tax year.
As for the maximum contribution answer, I totally forgot about the relevant earnings limit. I wrote that there wouldn’t be any annual allowance for him to carry forward to the 2016/2017 tax year. That’s 5 marks lost. Oh dear.