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Group Accounts:Comprehensive Example – Chapter 9

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Group Accounts:Comprehensive Example – Chapter 9

  • This topic has 1 reply, 2 voices, and was last updated 13 years ago by MikeLittle.
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  • December 1, 2012 at 9:51 am #56005
    dtsolak
    Participant
    • Topics: 2
    • Replies: 0
    • ☆

    In W2 while calculating the retained earnings of Dace we take into consideration the fair value of Dace’s Inventory 16.000 $. How does that affect the retained earnings until the day of acquisition (30 June 2009), since Dace have sold all of them before the year end (Dace sold them from 30 June 2009 until 31 Augutst 2009)???

    December 1, 2012 at 7:02 pm #109347
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23364
    • ☆☆☆☆☆

    Because, at the date of acquisition, her profits are understated! And, unusually, her post-acquisition profits are overstated

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