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Unrealised Profit Associate

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Unrealised Profit Associate

  • This topic has 1 reply, 2 voices, and was last updated 6 years ago by P2-D2.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
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  • September 19, 2018 at 10:48 am #475211
    sohail786110
    Member
    • Topics: 2
    • Replies: 2
    • ☆

    Hi Mike

    If an associate sells to the parents because the associate has earnt the profit we must deduct this unrealised profit from there retained earnings and we then calculate our share of the profits and then credit group inventory.

    If a parent sells to an associate we deduct full unrealised profit from group retained earnings because its the parent who made the profit theres no share to calculate. Also because associate has inventory cr investment in associate

    Is this correct ?

    September 23, 2018 at 9:14 pm #475596
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7156
    • ☆☆☆☆☆

    Hi,

    Yes, this sounds correct.

    Thanks

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