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Columbia co. M/J 21 Q1
sir i honestly just didn’t get the treatment of deferred income, where they find the FV of deferred income by finding its sales price.
what i did was in my maiden attempt at that question- was that i found the gross profit form the contract i.e. 2.21m-1.7=$0.51m,a dn added this to carrying amount of net assets.
DOUBT 2: same question: when calculating goodwill why did we not use full FV of brand of $5m? and instead used only the FV uplift of $1m? brands are not recognised by the acquirer themselves sir, so then why not add the full amount of $5m?
I think I’m with the answer that I would have considered FV from a market perspective – cost plus mark up
Re the brand – it says in the question that it already has a CA of 4
Please only put 1 question in a post in order to avoid deletion
yes sir but internally generated brands are not recognised, so then i thought it was not included. can you help me understand the logic of why you took only the increment?
re the deferred income, can you pls explain sir why there is a difference between control lability of $2.8m and $2.21m and the ensuing adjustment of $0.59m?
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