Consolidation - BPP

anniebabe

Hi guys
Please could someone explain the answer to the following question (i am getting lost with mark up and margin)

BPP - Text page 297 chapter 10 - Group accounts.

Task 6

Kilvert Ltd owns 60% of the issued share capital of Woodford Ltd. At the year end, their statements of financial position showed inventories of £100,000 and £50,000 respectively. Kilvert Ltd sells goods to Woodford at a mark up of 25% on cost. At the year end, goods which had been purchased from Kilvert Ltd for £30,000 remained in the inventories of Woodford Ltd.

Calculate the amount of inventories that should be recognised on the consolidated statement of financial position at y/e.

Thankyou

omega man

I make the answer £44,000.
The stock purchased cost kilvert £24,000 + 25%= £30,000.
Now how did i work that out, well 1/4 on 1/5 off.
So £6,000 is the unrealised profit.

anniebabe

thanks, its coming back to me know

Spamkebab

Hi Annie, did you attend the ICAS revision course in Manchester? If so, was it any good?

I cancelled as i had nearly finished ICAS, hopefully someone just starting out filled the gap.

Neil.

anniebabe

Hi Neil
No, I cancelled too, I want to get my financial statements passed, then i am planning to do my icas with Bpp in June.
I have the text books to read in between me finishing FNST and starting ICAS - and there is the recording from the Birmingham meeting - so hopfully I will be able to get my head around it.
How did you find it? I think its the one unit I am dreading the most, but I know I need to do it to finish
I wanted to have a go at ACCA after finishing AAT - but, I think that looking at the prices of the units for Icount and BPP, its going to have to wait a bit.

Spamkebab

Yeah the cost of further study is putting me off too. We have sacrificed holidays up to now while i paid for AAT lol.

ICAS isn't all that bad to be honest. I give it my best shot for my first draft (which was absolutely terrible) and then with the feedback i worked out what i needed to do for my second draft. second attempt came back and i only had to make a small number of changes. Getting feedback from the first attempt is what will help you.

The AAT exams are all weird, i've felt well out of my depth going in, but once passed i look back and think they weren't so terrible after all.

Good luck

Neil.