Question three

$[25$ marks$]$

a$)$ On $1$ January $2020,$ Company P acquired $80\%$ of the Company Q$.$ At that date, one of the

assets $($plant$)$ of Company Q$,$ had a fair value of M$8,000,000$ above its carrying amount.

The plant had a remaining life of $8$ years at this date $($straight$-$line method of depreciation is

used$).$ No adjustment on Company $Q$ of plants carrying amount has been made to cater for

the changes due to fair value exercise. Sales made by Company $Q$ to company $P$ after the

acquisition amounted to $M5,000,000.$ The costs of the goods to company $Q$ was $M3,$

$000,000$ and half of the goods still in inventories of Company $P$ as at $31$ December $2020.$

$NCl$ is measured at fair value.

Required

Prepare consolidated statement of profit or loss of Company $P$ group for the year ended $31$

December $2020.[18$ marks$]$

b$)$ State each of the steps in five$-$step revenue model as per IFRS $15[5$ marks$]$

C$)$ Briefly explain the term 'joint venture'.$[2$marks$]$