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Do we also adjust the PUP on a noncurrent asset sold to subsidiary in the Income statement Cost of sales?
Yes – where the TNCA is sold as part of “ordinary” sales of the selling company. In the question I’m thinking of where this came up, the question specified that the sale was made in the course of its ordinary activities
I mean when it sells for eg a plant to subsidiary and there is an intra group pup do we adjust in COS?
The example I can remember said that the parent old the asset out of stock ….ie it was included within the parent’s operating profit and the pup was therefore deducted from operating profits ( ie added on to cost of sales in the parent )
But aside frm that qs,if there is a pup on tnca sale do we adjust it in the cos as we do with pup on inventory?
Mike, how do we also treat pups arising from the sub trading with associates? or the converse?
No, I imagine that it should be expensed through the Income Statement … but how you would describe it in practice, I don’t know
Sir war abt the pup on sale of tnca to sub,do we take as adjustment to COS?
I’ve just answered that! See my previous post – “I imagine that it should be expensed through the Income Statement … but how you would describe it in practice, I don’t know”
What did you understand by that post?
Mr.Mike
why can’t we deduct PUP in Revenue instead of adding in COS since both will give us the same answer at the end. Is there any specific reasons?
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