hello sir,
i have a problem in agriculture example
(any changes during a period in fair value less costs to sell of biological assets are reported in the statement of profit or loss)
my question :
if this is the case then why dint we take the FV change of new born calves at 1 April 2013 when they were born (as 49.35 should be there value at intial recognition )compared with the FV after 6months 31 Sep 2013 ($58.15) into profit or loss instead took the whole amount at the end of the year to the income statement.
like we did for matured cows. we took the intial Cost of 235 per cow - FV at reporting date 227.95 = 7.05 in IS as revaluation.
Is it that revaluation is calculated only at the reporting date?
solution in the notes:
asset of 5,000 x $58.15 = $290,750 recognised in the statement of financial position and credited to income in the
statement of profit or loss
Ask the Tutor ACCA SBR
Agriculture
11y ago#1"Is it that revaluation is calculated only at the reporting date?"
Yes, we cannot be making entries throughout the year - it's only at reporting date that we shall take account of the fair value movement
Sir should the change in fair value of calves be not 44,000 in income statement its written 290,750.how?isn't 290,750 the value at reporting date ?
11y ago#3Yes, and how much were these same calves worth at the end of last year?
So what's the change in the value of these same calves?
5000*49.35=246750
y/e 5000*58.15=290,750
?
11y ago#5Er, no. They were only born this year so there was no brought forward value
that means if there was one more year after this then we would have calculated the revaluation gain/loss for the new born calves just like we did for the matured cow?
11y ago#7We would have been given information about the value of a cow that was one and a half years old. Multiply that by the 5,000 calves that are now 1.5 years old, deduct the 290,750 and there you have the (hopefully) credit to PorL
OK?
Yup all clear thanku :)
11y ago#9You're welcome
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