An accounting policy states that all inter-company transactions, receivables, liabilities and unrealised profits, as well as intra-group
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An accounting policy states that all inter-company transactions, receivables, liabilities and unrealised profits, as well as intra-group profit distributions, are eliminated.
(a) Discuss three examples of inter-company (also referred to as intra-group) transactions.
(b) Explain what is meant by ‘are eliminated’.
(c) Explain what effect there could be on the reported group profit if inter-company transactions were not eliminated.
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Related Book For
Financial Accounting And Reporting
ISBN: 9781292399805
20th Edition
Authors: Barry Elliott, Jamie Elliott
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