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CIMA Exam CIMAPRA19-F02-1 Topic 5 Question 100 Discussion

Actual exam question for CIMA's CIMAPRA19-F02-1 exam
Question #: 100
Topic #: 5
[All CIMAPRA19-F02-1 Questions]

On 1 January 20X1KL acquired 75% of the equityshares of PQ. Goodwill arising on the acquisition was $480,000. On 31 December 20X3 KLsold the full investment of PQ to XY Groupfor $2,000,000. On this date the net assetsof PQ were $1,340,000 and the non-controlling interests stood at $410,000.

What is the gain on disposal to be recognised in the consolidated statement of profit or loss of KL?

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Suggested Answer: A

Contribute your Thoughts:

Fletcher
8 days ago
Okay, time to put on my accounting superhero cape and solve this puzzle! Let's do this, one step at a time.
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Darell
14 days ago
Oh man, this is a real brain-teaser. I sure hope I don't mess up the math and end up with the wrong answer. That would be a total 'KL' on my part.
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Tresa
18 days ago
Alright, let's see. The selling price is $2,000,000, the net assets are $1,340,000, and the non-controlling interest is $410,000. Looks like I need to do some serious number-crunching here.
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Cherry
4 days ago
A) $590,000
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Dorsey
21 days ago
Hmm, this seems like a tricky one. Gotta remember that goodwill is part of the investment, so it should be factored in when calculating the gain on disposal.
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Yolande
1 months ago
I'm not sure, but I think the gain on disposal is $635,000.
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Amie
1 months ago
I disagree, I believe the gain on disposal is $660,000.
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Quentin
1 months ago
I think the gain on disposal should be $590,000.
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