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Fair value adjustmentIFRS 3 requires that goodwill on consolidation should be based on the fair values of the net assets of the subsidiary company on the date of acquisition.This means that the subsidiary company should revalue its assets on the date of acquisition.But unfortunately no revaluation may have been done. For the purpose of consolidation, it is important to determine what should have been the revaluation gain or loss if an asset is revalued. In most cases we revalue non current assets such as Property, plan nd equipment, intangible assets and long term investments. If there is a revaluation gain on any of the assets then the following entry will be made:a) To record the revaluation gain
DR. Group PPE/intangible assets/Longterm investments (with the full revaluation gain) CR. Cost of control (with holding company share of revaluation gain) CR. M.I (with M.I’s share of the revaluation gain)For assets that are meant to be depreciated or amortized, (PPE and Intangibles), the total depreciation or amortization that should be charged to date should be estimated and provided for .b) Compute the additional depreciation that should have been provided to date had the subsidiaries assets been revalued and record the amount as follows;
DR. Group retained profits (with holding company share of additional depreciation)DR. M.I (with M.I’s share of additional depreciation) CR. Group PPE/Intangible assets (with the full additional depreciation)
1. Lease vs. Buy Trasky Company is trying to decide whether it should purchase or lease a new automated machine to be used in the production of a new product. If purchased, the
Sales volume reaches the maximum capacity of the new machine in Year 4. The positive NPV point to that the investment in Machine Two is financially acceptable althoug
explain accounting concepts and conventions?
#question.how to account enginering cost
The following information for the six months ended 31 December 2009 relates to the business of Mr N Morris: a) Opening cash (including bank) balance Rs 1,200 b) Production in unit
In the current year, Madison Corporation had $50,000 of taxable income at a tax rate of 25%. During the year, Madison began offering warranties on its products and has a warranty l
2500 WORDS
Exclusions - Income item that is excluded from a taxpayer's gross income by INTERNAL REVENUE CODE or an administrative action. Common exclusions comprise gifts, inheritances and de
The New York Jets have decided to go public and are offering new shares for $40. Since the Jets want to build a new stadium, the firm will retain all earnings and will not issue an
explain the procedure followed in gpvernment system of accounting in india
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