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- September 4, 2022 at 2:28 am #665056
X Co acquired 80% of the equity share capital in Y Co on 31 July 20X6. Extracts from the 2 companies’ statement of profit or loss for the year ended 30 September 20X6 were as follows:
Revenue (X Co) = 3.4 million Cost of sales (X Co) = 1.5 million
Revenue (Y Co) = 2.4 million Cost of sales (Y Co) = 1.8 millionDuring the year ended 30 September 20X6, Y Co sold goods for $5,000 each month to X Co, at a mark up of 25%. At the end of the year X Co had 50% of these goods left in inventory.
What is the group profit for the year ended 30 September 20X6?
Sir in this question for group gross profit unrealised profit would be 1000But in inventory 50% of 60000 i.e. 30000 will be present .So will we subtract 1000 or 6000( 1000×12×50%) in sofp inventory?
September 4, 2022 at 8:24 am #665085Only the purp since the date of acquisition.
September 4, 2022 at 8:32 am #665089So sir only 1000 …right ?
Hence purp in p/l = purp in sofpSeptember 4, 2022 at 6:19 pm #665130Correct 🙂
September 4, 2022 at 6:40 pm #665144Thanks sir
September 4, 2022 at 6:46 pm #665148You are welcome.
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