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Dear Sirs,
Associate sells to parent therefore P holds inventory at year end.
Therefore, I think adj should be:
Dr Group RE/share of profit of associate (PL) 60,000
Cr group Inventory 60,000NB: In OT video, Chris says not reduce investment in associate (SFP) when A sells to P.
BPP solution:
Dr Group RE/share of profit of associate 60,000
Cr investment in associate 60,000Why is BPP not getting rid of unrealised profit held in inventory at ye?
Thank you
james8500 wrote:Dear Sirs,
Technically what I’ve done is correct but to make it easier the standard entry for associate PUPs is to DR Retained earnings CR Inventory as it then matches what is done for a PUP between P and S.
Thanks
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