Patience Co has a subsidiary, B Co.
During 2014 B sold goods to Patience Co for $90,000 which has cost plus 20%. At December 2014 , $ 60,000 of these goods remained unsold.
How much revenue and profit will be reduced in the consolidated statement of profit or loss for the year ended 31 December 2014?
Suggested solutions:
| Revenue reduced by | 90,000 |
| Profit reduced by | 10,000 |
Working :
Goods remained unsold /(cost plus %) X profit %
=60,000 / (1 + 0.2 )X 0.2
=$10,000
To do the same topic again in ACCA F3 consolidated revenue 3