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MikeLittle.
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amelia85
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Hi sir for this question
The inventory is in transit to my understanding it should be in Zennor company’s Financial statement (FS) if not the group inventory will be understated.
Then if group sell inventory to Zennor co(ZC). There will be a profit in the group revenue hence profit should be eliminated from the revenue in group FS.
If group sell on credit to ZC the receivables and payables of the individual FS if not group receivables and payables will be overstated.
Pls advice thanks
MikeLittle
- Topics: 26
- Replies: 22594
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This is a question for F7 (if not for F3!)
Goods in transit?
Accelerate them for accounting purposes to the records of the recipient
Now, eliminate revenue and cost of sales from the GROUP trading account
And also make adjustment for the pup in the records of the selling entity … for the purposes of the preparation of the consolidated financial statements
Selling on credit? Eliminate the intra-group receivables and payables from the consolidation
Does that make it better?
amelia85
- Topics: 34
- Replies: 53
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K Sir thanks for helping me to recap 🙂
MikeLittle
- Topics: 26
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You’re welcome
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