Consolidated statements of financial position

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November 12, 2020 at 8:57 pm #594826
fatimarashed8
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Question name: Dargent Co from M/J 2017 paper
My doubt is related to goods in transit
If you please check the question paper and answer why is only 2300 being deducted from trade payables why not 3000 since we are assuming that the goods in transit have been received by the subsidiary
November 13, 2020 at 9:29 pm #594940
P2-D2
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Hi,
The goods are in transit so no entries will have been recorded by the subsidiary so we will record the 700 in payables (DR Inventory Cr Payables), before we then remove the intra-group balance of 3,000. The net impact is the 2,300.
Hope that clears it up.
Thanks
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