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December 2013 chmura

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › December 2013 chmura

  • This topic has 3 replies, 2 voices, and was last updated 11 years ago by AvatarJohn Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
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  • November 8, 2014 at 1:40 pm #208412
    Avataremoke
    Member
    • Topics: 3
    • Replies: 3
    • ☆

    Chmura sells packing material to its foreign subsidiary in dollar, what is deducted from the MP cashflows, reducing the foreign tax base and also the cashflows. But as it is revenue for the holding company, i would have assumed it should be added back to the dollar cashflows when we calculate the value of the whole project. It is not added back in the answers, why not?

    November 8, 2014 at 6:33 pm #208469
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54838
    • ☆☆☆☆☆

    They will get income from the subsidiary for the special packaging, but they will also have the cost of buying the special packaging.

    So the net effect for Chmura itself is zero.

    November 9, 2014 at 9:20 am #208534
    Avataremoke
    Member
    • Topics: 3
    • Replies: 3
    • ☆

    Thank you!

    November 9, 2014 at 1:33 pm #208596
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54838
    • ☆☆☆☆☆

    You are welcome 🙂

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