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For question on highwood for june 2011, for transaction (vi) on factored receivables.
The sale is supposed to be treated as a short term loan and finance cost on the loan is supposed to be charged to the SOPL right ?
But in the answer key i realise that the loan is recorded as just 8700. By right we are supposed to add the finance cost to the carrying value of the loan on the SOFP right ?
Also i realised there was no finance cost charged on the loan . Why ?
“The sale is supposed to be treated as a short term loan and finance cost on the loan is supposed to be charged to the SOPL right ?”
Agreed
“By right we are supposed to add the finance cost to the carrying value of the loan on the SOFP right ?”
Agreed
“Also i realised there was no finance cost charged on the loan . Why ?”
Tell me …. if this “loan” from easy Finance had carried interest at the rate of 12%, exactly how much should have been shown as a finance charge in the year to 31 March, 2011?
Let me know as soon as you can
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