ACCA Financial Reporting F7LSBF TEXT F7 section 2
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The equity method of accounting requires that the group share of the profits of the associate are reported in one line in the consolidated income statement, calculated as:. $
Sales are recognised in the income statement at the moment when the significant risks and rewards of ownership of the goods have been transferred to the buyer, which is
¾ The average carrying amount of the asset during a period, including borrowing costs previously capitalised, is normally a reasonable approximation of the expenditures to which
This will give an annual impairment of goodwill of $20,000 which will be charged as an expense in the current years statement of comprehensive income.. The previous
¾ All assets and liabilities of the subsidiary that are recognised in the consolidated statement of financial position are measured at their acquisition date fair values.. ¾
¾ Where the share of the associate’s net assets acquired at fair value are in excess of the cost of investment, the difference is included as income in determining the investor’s
If a business revalues its assets rather than carrying them at historic cost, this will usually increase capital employed and reduce profit before tax (due to higher
a For assets carried at fair value, impairment is the difference between cost and fair value, less any impairment loss previously recognised in the statement of profit or loss; b For