Associate

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October 23, 2018 at 8:41 pm #479602
adarsh1997
Participant
- Topics: 646
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Hello Chris,

If an associate sell to the parent, the adjustment for the unrealised profit is as follows:
DR Group RE
CR group inventory

In the CSOFP, we need to remove the PUP due to the fact that the parent holds the inventory?

But in the CSOPL, how we would deal with the adjustment? Do we need to increase cost of sales?
October 28, 2018 at 7:30 am #480002
P2-D2
Keymaster
- Topics: 4
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Hi,

As the associate has made the sale, it will have made the profit and therefore the share of profit of associate is adjusted and not the cost of sales.

Thanks
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