[Mohan]

Yes there was overprovision of 20,000 which decrease the tax liabiality in current year ( not increases ) I feel tricy part is there in deferred tax ..question said increased provision by 8000 but this includes related revaluation gain ……

Year end estimate 240,000
Less: over provision ( 20,000)
Whether add or less **8000**

I feel ans will either be 228000 or 212000 …mine was 212,000 May be wrongly anwered …not sure

[Mohan]

Thanks for the reply …but as I remember the option to deduct 2400 from inventory were not there ………or by oversight I got confused ….I knew the correct ans although couldnt apply due to provided option ……….or I think I messed completely …..

[Mohan]

Hi All…
Hope Everyone has done well, acctually I have a question in section A , ( Relating Green Co. And Blue co., Green co acquired 30% of Blue co and Blue co selling to Green making profit of 40,000 where invetory held at green co that is 20%) how the unrealised profit will be treated ?

Options were :
A.Deduct 2400 in Investment in associat
B. Add 2400 in Inventory
C. Add 8000 in Investment in associate
D.Deduct 8000 in Inventory

I believe answer would be deduct 2400 in inventory , but there was no option …pls suggest wo remember the question well…..

One more question relating tax to be charged in P/L , where it was stated that current year estimate is 240,000 and previous year tax charge in P/L 200,000 but tax authority confirmed 180,000 . at the year end deferred tax provision has increased by 8000 .this includes any revaluation gain above .( Revaluation gain was 500,000 and related deferred tax was 150,000)

Options were :
A. 248,000
B. 240,000
C.212,000
D.228,000

What will be the correct ans ..pls comment ….

[Author]

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