While calculating Dept B's (Ndege) earnings, we started from PBDIT and charged depreciation.
But while calc department A's PAT, we didn't take the finance costs, or depreciation into consideration. Instead the examiner straight away took the Pre-tax profits and charged tax on it.
Why wasn't Department A's PBDIT taken first and then the depreciation (relevant to Department A, i.e. 98.2*40%*10%) charged on it?
Ask the Tutor ACCA AFM
VOGEL CO (JUN 14)
3y ago#1They have added on 0.5 x $23m x 0.8 for department A. The $23m is already after depreciation.
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