Page 20 - FAC4862 slides JAs and Revenue CM
P. 20
JOINT ARRANGEMENTS
Basic Example 1
• As a separate entity is not established and each entity
has direct rights to a specified percentage of certain
assets. Each entity can have differing rights to and
percentages of other assets, and different obligations
for various liabilities.
• Each company includes its share of the development
costs, assets and liabilities and income and expenses
from the sale of the package in the agreed upon ratio
in its separate annual financial statements, because
the arrangement is a joint operation.
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