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What should we do if Subsidiary transfer plant with carrying value of 10000 to parent for 15000. The parent depreciate the plant by using straight line method. The useful life of plant is 5 years.
The date of accquisition is 1 may 2018
Date of transfer of plant is 1 june 2018
Reporting date is 30 november 2018This is not really relevant for Paper FA.
However the parent and the subsidy are two separate legal entities and so the transfer is accounted for in the same way as when any company sells a non-current asset to another company.
Hi sir, i have a doubt in the question, i hope you could clear it for me. The question is really long so i will only include the relevant information.
Claus Co purchased 75% of the voting capital of Rolph Co on 1 October 20X1.
Claus Rolph
Non-current assets
Property plant and equipment $3270 $1565NOTES:
2. At the date of acquisition, the fair value of Rolph Co’s property, plant and
equipment was equal to its carrying amount with the exception of Rolph Co’s land which had a fair value of $200,000 in excess of its carrying amount. The fair value has not been reflected in Rolph Co’s individual financial statements.Sir i want to know how to calculate the value for PPE and also if there is a revaluation surplus. I don’t have an answer to compare with as this is a question from a mock exam.
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