[sadiya010]

@alham

quick example:

if a company purchase an asset cost $15m in 2010 let say when the exchange rate was £1= 1.50USD
so the cost in pound is $15/1.5 =£10m in 2010.

the company sold the Asset in 2011 when the exchange rate is gone down £1=1.25USD. now the cost is $15/1.25 =£12m

calculate the Gain or loss on fixed asset.

will there be a gain or loss? let’s see

Sold for £12
les Bought for £10

(£12- £10) = £2m its again on disposal fixed asset.therefore it goes to income statement (add to gross profit ). but if it was a loss we deduct it.

also adjustment have to be done to Retained earning (plus if its a gain) minus if its a loss.

Note: please it could be anything not just buying asset but it could be loan or other stock.

Sorry i have nott got the question but if the gain or loss is not done in Qs Ribby is because its not asking to do it. means there is no diffrent currency used within the group account.

hope it helps.

[sadiya010]

@alham

quick example:

if a company purchase an asset cost $15m in 2010 let say when the exchange rate was £1= 1.50USD
so the cost in pound is $15/1.5 =£10m in 2010.

the company sold the Asset in 2011 when the exchange rate is gone down £1=1.25USD. now the cost is $15/1.25 =£12m

calculate the Gain or loss on fixed asset.

will there be a gain or loss? let’s see

Sold for £12
les Bought for £10

(£12- £10) = £2m its again on disposal fixed asset.therefore it goes to income statement (add to gross profit ). but if it was a loss we deduct it.

also adjustment have to be done to Retained earning (plus if its a gain) minus if its a loss.

Note: please it could be anything not just buying asset but it could be loan or other stock.

Sorry i have nott got the question but if the gain or loss is not done in Qs Ribby is because its not asking to do it. means there is no diffrent currency used within the group account.

hope it helps.

[sadiya010]

Dec 2011 paper

Good will 120.2

NCI 20/80 x 120.2=30.05

[sadiya010]

Hi
This is how i understand but not sure it will help.

On the 1 june 2007 Bradova acquired 6% of the share capital of Mixted. the purchase considaration for this is $10m available for sale for the year end 31 of May 2008.

Bravado decide to buy more and bought 64% shares of Mixted on the 1 june 2008 and the considaration $118.
Now Bravado is holding (64%+6%)= 70% of Mixted and Bravado controls Mixted.

To calculated Good will. first we need to know what was the FV and considaration for the 6% of mixted before becoming a subsidiary.

1 june 2007 Holdin 6% considaration $10m
1 june 2008 Holding 64% considaration $118m
1 june 2008 Fair value held by Bravado before business combinatin $15m
1 june 2008 Bravado estimated fair value $12m for june 2008-2009.

2008(Bravado held $15m already before they become one company as bought 6%SC therefore made a gain on this ($15-$10)= $5gain) before subsidiary.

But the FV $12 is estimated after they become one company.

purchase considaration is = ($128-$10)+$12 +$15 = $145

Share capital in SOFP of Mixted is $100
Retain pre earning note( ii) $55
OCE ( ii) 7
FV increase adj 14

Total above = 176 x70% = 123.2
tax ex 166 note ii (176-166×30%) ( 3) x 70% = (2.1)

Good will value is 145 – (123.2 – 2.1) = 23.9GdW

FV idendifyable note (ii):$M
170+6= = 176
(100+55+7)= 162
increase Fv = 176- 162= 14

sorry not sure abt the $4 you are asking as i dont see this figure any where in this Maxet QS.

Hope it make sense

[sadiya010]

I am ready to face the study pain.as there is no gap between p1- p3 exams. i have decided to take p2 and p3. already started on p2 it seems goodwill Qs is killing me but lets hope it will be fine.

Thanks very much Cuteleo. u are the best;)

[sadiya010]

Hi Jc

i am in for p2.

[Author]

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