at the mom Discuss whether the subsidiary can be classified as held for sale.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question

3.

 

A subsidiary entity, Claystone Ltd, is for sale at a price $ 15 million. There has been some interest from prospective
buyers but no sale as yet. One buyer has made an offer of $ 14 million but the directors of the parent company have
declined the offer. An accountant firm which was appointed by the parent company has just submitted a report and
advice that the fair value of Claystone Ltd is $ 16.5 million. They have decided not to lower the sale price of Claystone
Ltd at the moment.
Discuss whether the subsidiary can be classified as held for sale.
Transcribed Image Text:A subsidiary entity, Claystone Ltd, is for sale at a price $ 15 million. There has been some interest from prospective buyers but no sale as yet. One buyer has made an offer of $ 14 million but the directors of the parent company have declined the offer. An accountant firm which was appointed by the parent company has just submitted a report and advice that the fair value of Claystone Ltd is $ 16.5 million. They have decided not to lower the sale price of Claystone Ltd at the moment. Discuss whether the subsidiary can be classified as held for sale.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Consolidations
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education