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Hi Mike,
On June 2011 Exam Q1, I couldn’t get why the $19m (Purchase consideration for extra10% interest) hasn’t been credited to the current assets of the group although it’s cash transaction.
I would really appreciate it if you could have a look at the question and explain.https://www.accaglobal.com/content/dam/acca/global/PDF-students/2012b/june11q.pdf
Maybe it’s because the further acquisition took place on 30 April and the statements of financial position are as at close of business on 30 April and therefore the statements given already reflect the cash payment for the additional 10%?
Thanks very much, that what I thought too although it’s very confusing as to how they posted the cash transaction without adjusting the investment in Stem accounts!
Well, surely that adjustment also took place before the year end! I’ll need to check the question again tomorrow if I’m wrong
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