recognise the Purchased emission allowances? As an intangible asset, inventory, debtor? Your team need to explain why the emission allow
During the 2021/2022 financial year, the company had following events.
On 1 April 2022, ABC Industry purchased additional 30,000 allowances on the market as the initially granted emission allowances seemed insufficient to settle their obligations (emission liabilities). On this date, the fair value of an allowance was $60.
1) How to recognise the Purchased emission allowances? As an intangible asset, inventory, debtor? Your team need to explain why the emission allowances should be recognised as such.
There is no uniform wear to address how the emission should be presented in a financial statement or a proper disclosure that should be made. There are different approach by different firm. They do it as a result of expense that is incurred but deferred from region to region and company to company.
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