[pohneetale]

My problem now is, what is the sense behind this treatment? I just can’t get it out of my head with a sensible understanding.

[pohneetale]

Well, I’ve seen one question which came from past sittings before the change of the syllabus to P2 but I’m not sure which sitting was that.

The question is something like follows:

H acquired 80% of interest in S(which has 500m of $1 ordinary shares) for $800m on 1 Apr 20X4 and the reserves at this date was $100m and acquired the whole of $40m 10% debentures in issue by S at a cost of $60m.

Abstract of SOCI ftye 31 Dec 20X4:

H
Interest receivable $4m

S
Interst payable $4m

The answer for Goodwill is $339m.

Could you please explain to me about the treatment?

Thank you!

[Author]

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