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hi mike
i am stuck in grange question on disposal part of sitin. it said that there is $36 million identifiable net assets when dispose sitin’s 60% equity for 39 million and there is $32 million when parent acquire 100% sitin’s interest. of the increase in net assets, $ 3m reported to profit or loss and $1 MILLION HAD BEEN REPORTED IN OTHER COMPREHENSIVE INCOME AS PROFIT ON AN EQUITY INSTRUMENT (WITH IRRECOVERABLE OF ELECTION). what i don’t understand is that $1 million was deducted from net assets to derive gain/loss on disposal? why it is deducted and what the terms “with irrecoverable of election” means? please help meoutHi – BPP have issued a correction sheet effective in their revision kit.
One of the corrections is to remove from working (a) the “reclassified gain” leaving a loss on disposal of 7
In working 4 “retained earnings”, the loss on disposal is now shown as (7) and in working 5 “other components of equity” the “gain on IEI reclassified” is now deleted
Does that make you feel better?
Dear Tutor
That information very much helped me to get out from mental stress.Thanks.
Could I again add on to that , why that loss on disposal { (6) in old bpp revision kit and (7) in correction sheet as you said } is not taken for impairment testing of Grange.I am confused in general as to what all items we should take for the calculation of
impairment of net assets.Tutor grateful if you could help me on this.
regards
Jaison
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