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m/j 06 Q4 how does the profit decrease??
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m/j 06 Q4 how does the profit decrease??
hahaha...will give the link next tym.why do you never give link to the paper?
Because after the debentures are redeemed, we wont have to deduct the interest from profit
why do you never give link to the paper?
Because after the debentures are redeemed, we wont have to deduct the interest from profit
The profit increases and not decreases!! net current assets decrease!m/j 06 Q4 how does the profit decrease??
net bank borrowing are (150+35-15)=170 and ordinary shareholders fund are (120+100+160)=380
The profit increases and not decreases!! net current assets decrease!
OMG! You are right as per marks scheme but can you explain it.
fixed cost covered by us = 4200 (600 * 7) so the remaining fixed cost to be covered is 800 (5000-4200) and we need 200 more units to break even, so the contribution required will be (800/200) = 4 and hence add the variable cost in contribution to find the selling price , so selling price will be (4+19)=23
still don't get itto get the number of debenture notes.
Aree you're a fkng terrorist man. y do u care bout studying. if u fail just send a bomb to cie na chutyei was doing the wrong question :\
I understood that but when a debenture is redeemed a redemption reserve is created so by redeeming aren't we not decreasing the profit as interest takes a small proportion of the net profit.
like in ordinary shares we divide share capital by its price to get the number of shares. Same is case here we divide $10000 by 10 to get the number of debenture notes issued.still don't get it
I understood that but when a debenture is redeemed a redemption reserve is created so by redeeming aren't we not decreasing the profit as interest takes a small proportion of the net profit.
Nope. The Debenture Redemption Reserve are not created unless stated by the Directors to do so. They are not compulsory as the creation of Capital Redemption Reserve.Profit decrease as part of it got transferred to the redemption account.
Nope. The Debenture Redemption Reserve are not created unless stated by the Directors to do so. They are not compulsory as the creation of Capital Redemption Reserve.
So unless the question mentions the creation of DRR, dont make it!
But it doesn't say $10000 its 10000 $10 debentures, so doesn't that mean there are 10000 debenture certificates each worth $10?like in ordinary shares we divide share capital by its price to get the number of shares. Same is case here we divide $10000 by 10 to get the number of debenture notes issued.
Okay people I think this is enough! We all require a good night sleep. Tomorrow's exam can be tricky. I recommend you all to look at the relevant IAS and theories related, not need to look at outdated question papers, 2009-11 will be enough . Best of luck to Everyone!
soorry bt the MS says profit inc. n net assets dec. how ??Profit decrease as part of it got transferred to the redemption account.
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