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I have a scenario whereby during the year ended 31 dec 2019, the parent disposed of a PPE to its subsidiary at a profit of let’s say $1,000.
As such, this unrealised gain has been canceled out during the y/e 2019.
However, during 2020, the subsidiary has been fully disposed of.
Grateful if someone could clarify me as the accounting entries iro the unrealised profit previously cancelled out in 2019. Thanks!
I assume that this is not a real world example – we don’t give advice in those situations.
If it is an exam question please let me know which one.