question archive Oat bought 20% of Flax on 1 January 20x1 for £500,000 when Flax had £1,000,000 share capital and £3,600,000 retained earnings
Oat bought 20% of Flax on 1 January 20x1 for £500,000 when Flax had £1,000,000 share capital and £3,600,000 retained earnings
Subject:AccountingPrice: Bought3
Oat bought 20% of Flax on 1 January 20x1 for £500,000 when Flax had £1,000,000 share capital and £3,600,000 retained earnings. Oat has as a contractual agreement with two other investors in Flax such that theyjointly control Flax's operations
At the year—end 31 December 20X1, Flax had retained earnings of £4,000,000.
During the year Oat sold goods to Flax, making a profit of £50,000. None of these items had been sold by Flax at the year end.
What is the value to be shown under "Investments in Joint Ventures" in the consolidated statement of financial position at 31 December 20x1?
0 a. None of these options are correct
0 b. £530,000
0 c. £580,000
0 d. £820,000
0 e. £770,000
0 f. £570,000
