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Joint venture

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Joint venture

  • This topic has 3 replies, 2 voices, and was last updated 1 week ago by Stephen Widberg.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • May 26, 2023 at 5:10 pm #685134
    boiledalien
    Participant
    • Topics: 12
    • Replies: 7
    • ☆

    This is part of a ques in the bpp kit

    “The natural gas station cost $15 million to construct, was completed on 1 June 20X2 and is to be dismantled at the end of its life of ten years. The present value of this dismantling cost to the joint operation at 1 June 20X2, using a discount rate of 5%, was $2 million.”

    on 1 june 20X2, they r adding accumulated depreciation of 6.8/10 to the carrying amount of 40% of 15 m. why?

    May 27, 2023 at 6:51 am #685169
    Stephen Widberg
    Keymaster
    • Topics: 13
    • Replies: 2986
    • ☆☆☆☆☆

    1. A joint venture is NOT a joint operation (please revise). If you say JV when you mean JO, you won’t get marks. Remember, most of the marks are for words not numbers in this exam. 🙂
    2. If JO, company will include its share of jointly owned assets in PPE.
    3. If there is a decommissioning provision, you add it to the CA of the PPE at the 1/6/x2. The total will then be depreciated over the life of the PPE.

    May 27, 2023 at 8:03 am #685171
    boiledalien
    Participant
    • Topics: 12
    • Replies: 7
    • ☆

    Okay sir, thank you.
    Also yes, I will keep in mind to use the right words. Thanks again.

    May 28, 2023 at 7:28 am #685215
    Stephen Widberg
    Keymaster
    • Topics: 13
    • Replies: 2986
    • ☆☆☆☆☆

    🙂

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘Joint venture’ is closed to new replies.

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