Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Please help me i will give good rating (b) On 1 January 2020, AZ acquired 80 per cent of the ordinary share capital of a
Please help me i will give good rating
(b) On 1 January 2020, AZ acquired 80 per cent of the ordinary share capital of a foreign entity, PH for Croner 15,880,000. At the date of acquisition, the net assets of PH had a fair value of Croner 16,300,000. The group policy is to value non-controlling interest at fair value at the date of acquisition. The fair value of the non-controlling interest at the date of acquisition was Croner 3,970,000. For the year ending 31 December 2020, the profit for PH is Croner 200,000. At 31 December 2020, the goodwill that arose on the acquisition of PH was impaired by 30 per cent. Impairment is translated at the average rate. The relevant exchange rates were as follows: 1 January 2020 RM/Croner 2.32 (RM 1 = Croner 2.32) 31 December 2020 RM /Croner 2.23 (RM 1 = Croner 2.23) Average rate for 2020 RM /Croner 2.30 (RM 1 = Croner 2.30) Required: Calculate the translation gain or loss for the AZ Group for the year ended 31 December 2020. (13 marks) (b) On 1 January 2020, AZ acquired 80 per cent of the ordinary share capital of a foreign entity, PH for Croner 15,880,000. At the date of acquisition, the net assets of PH had a fair value of Croner 16,300,000. The group policy is to value non-controlling interest at fair value at the date of acquisition. The fair value of the non-controlling interest at the date of acquisition was Croner 3,970,000. For the year ending 31 December 2020, the profit for PH is Croner 200,000. At 31 December 2020, the goodwill that arose on the acquisition of PH was impaired by 30 per cent. Impairment is translated at the average rate. The relevant exchange rates were as follows: 1 January 2020 RM/Croner 2.32 (RM 1 = Croner 2.32) 31 December 2020 RM /Croner 2.23 (RM 1 = Croner 2.23) Average rate for 2020 RM /Croner 2.30 (RM 1 = Croner 2.30) Required: Calculate the translation gain or loss for the AZ Group for the year ended 31 December 2020. (13 marks)Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started