Page 242 - FR Integrated Workbook 2018-19
P. 242
Chapter 17
Example 8
PUP adjustment – inventory
On 1 May 20X7 Karl bought 60% of Susan. Extracts from the statements of
financial position for the two entities as at 30 November 20X7 show:
Karl Susan
$ $
Current assets
Inventory 15,000 17,000
The inventory of Karl includes $8,000 of goods purchased for cash from
Susan at cost plus 25%.
Required:
Prepare extracts from the consolidated statement of financial position
of Karl at 30 June 20X8.
Solution
$
Current assets
Inventory (15,000 + 17,000 – 1,600 (W)) 30,400
(W) PUP – Profit in inventory $8,000 × 25/125 = 1,600
236
