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Hi, please advice why at the begining when you apportion profit on pre and post acquisition you deduct capital gain(I presume that is capital gain on disposal) on PPE(36000) and after approtionment you add it to profit after acquisition. So technically you transfer this gain to post acqusition period instead of evenly appoortion in whole year. I am confused how to treat this point 2 in this example…
For your reference point 2 from example 1
On 31 July 2011, Danute had sold an item of property, plant and equipment to Ausra realising a profit on sale of $36,000. Ausra
was depreciating this item over its remaining useful life of 4 years. It is group policy to charge a full year’s depreciation in the year
of purchase, and none in the year of sale.The date is important. It’s a one-off transaction, not part of ordinary trading and it specifically takes place in the post acquisition period. So, apportion “normal” profits and then add on the intra-group profit
Ok?
Hello sir! Could you please clarify why in calculation of #7 dividends we take 80,000 shares of Danuto whereas in the Statement of FP for 31 October it is stated 60,000 shares (40,000 equity shares + 20,000 share premium).
thank you in advanceShares are shares and do not include the share premium (which is the premium received above the nominal value of the shares)
The $40,000 that you quote is a monetary amount but if you look closely you will see that e Danute shares have a nominal value each of just 50 cents.
So $40,000 share capital is in fact 80,000 equity shares of 50 cents each
Ok?
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