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consolidation

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › consolidation

Viewing 2 posts - 1 through 2 (of 2 total)
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  • August 10, 2018 at 1:40 pm #467195
    adarsh1997
    Participant
    • Topics: 646
    • Replies: 282
    • ☆☆☆☆

    Hello Chris.

    1. How should unrealised profit be treated?

    -The answer is DR cost of sales and CR inventory.
    -Kindly explain why do we need to DR COS?

    Thanks.

    August 13, 2018 at 8:01 pm #467745
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7212
    • ☆☆☆☆☆

    Hi,

    We have to reduce the profit made on the sale of the inventory, which is part of our trading operations, hence as cost of sales is part of our trading account it seems appropriate to make the adjustment here.

    Thanks

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