June 2014 Marchant consolidation

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May 11, 2018 at 6:13 am #451164
sss111
Member
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As per note 4 where “Nathan still hold $8m in inventory at year end” , we should create a provision for unrealised profit and added it to coat of sales right?

It doesn’t seem to have been recorded in the answer, why ?
May 13, 2018 at 9:08 am #451607
P2-D2
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Hi,

As the transaction is at fair value then it is evidence that the inventory has fallen in value, given we made a loss on the transaction. We do not therefore reverse out the loss.

Thanks
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