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Question three [ 2 5 marks ] a ) On 1 January 2 0 2 0 , Company P acquired 8 0 % of the

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 M8,000,000 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'.[2marks]
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