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Viagem bpp

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Viagem bpp

  • This topic has 1 reply, 2 voices, and was last updated 1 year ago by P2-D2.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • April 29, 2021 at 10:30 am #619165
    joseph0978
    • Topics: 2
    • Replies: 1
    • ☆

    hi regarding this question
    “Although Greca has been profitable since its acquisition by Viagem, the market for Greca’s products has been
    badly hit in recent months and Viagem has calculated that the goodwill has been impaired by $2 million as at
    30 September 20X2”
    This goodwill was only deducted from the consolidated p&l and not goodwill calculation

    here’s the answer script
    “Consolidated goodwill at acquisition $’000 $’000
    Consideration transferred:
    Shares (9m × 2/3 × $6.50) 39,000
    Deferred consideration ((9m × $1.76) / 1.1) 14,400
    53,400
    Non-controlling interest ((10m × $2.50) × 10%) 2,500
    55,900
    Fair value of net assets:
    Share capital 10,000
    Retained earnings: b/f 35,000
    three months to 1 Jan 20X2 (6,200 × 3/12) 1,550
    FVA on plant 1,800
    Contingent liability (450)
    (47,900)
    Goodwill 8,000”
    Could you explain why this is? Thanks in advance.

    April 29, 2021 at 9:09 pm #619227
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6119
    • ☆☆☆☆☆

    The goodwill impairment should have been deducted and I can’t see why they haven’t done so.

    Thanks

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    Posts
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