June 2012 – W3 Consolidate Earning (loan note)

This topic has 2 replies, 2 voices, and was last updated 10 years ago by MikeLittle.

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November 29, 2015 at 3:47 pm #286162

Yazan
Member

Hi Sir,

Just a quick question, when you are working out the Consolidated Retained Earnings (w3) why do you only cancel the loan note interest and not the loan note itself?

Kind regards,

yazan

November 29, 2015 at 3:48 pm #286163

Yazan
Member

This is in regards to your revision lecture. I assume I should always be cancelling the loan notes between the parent and sub?

November 29, 2015 at 10:09 pm #286235

MikeLittle
Keymaster

Because the loan note liability features in the statement of financial position, not in the statement of profit or loss

Only the loan interest affects retained earnings, not the loan itself
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