www.kaplanpublishing.co.uk Section Introducing associates and joint ventures Answer Spider a) Extract from the group statement of financial position Investment in the associate Parent's investment in Spider Plus the % of the associate's post-acquisition profits Less the % of the associate's purp (30% x 150,000) 30% x (20,000-10,000) $ 200,000 45,000 (3,000) 242,000 The parent has sold the goods to the associate so the unsold stock is in the accounts of the associate, thus in the group statement of financial position the purp is deducted from the investment in the associate b) Extract from the group statement of profit or loss Income from the associate % of the profit for the year (30% x 50,000) $ 15,000 The parent has sold the goods to the associate so the parent has reported the profit, thus in the group statement of profit or loss the purp is added to the group's cost of sales A student's guide to Group Accounts by Tom Clendon, Second Edition, published by Kaplan Publishing www.kaplanpublishing.co.uk Section Introducing associates and joint ventures Answer Fly a) Extract from the group statement of financial position Investment in the associate Parent's investment in Fly Plus the % of the associate's post-acquisition profits (40% x 50,000) Plus the % of the associate's post-acquisition other comprehensive income (40% x 40,000) Less the impairment loss on the investment $ 300,000 20,000 16,000 (10,000) 326,000 b) Extract from the group statement of profit or loss Income from the associate % of the profit for the year Less the impairment loss on the investment (40% x 50,000) $ 20,000 (10,000) 10,000 Extract from the group statement of other comprehensive income Income from the associate (40% x 40,000) 16,000 A student's guide to Group Accounts by Tom Clendon, Second Edition, published by Kaplan Publishing ...www.kaplanpublishing.co.uk Section Introducing associates and joint ventures Answer Fly a) Extract from the group statement of financial position Investment in the