CIMA Exam CIMAPRA19-F02-1 Topic 1 Question 90 Discussion

Actual exam question for CIMA's CIMAPRA19-F02-1 exam

Question #: 90
Topic #: 1

A group presents its financial statements in A$.

The goodwill of its only foreign subsidiary was measured at B$100,000 at acquisition. There have been no impairments to this goodwill.

Exchange rates (where A$/B$ is the number of B$'s to each A$) are as follows:

The value of goodwill to be included in the group's statement of financial position in respect of its foreign subsidiary for the year ended 31 December 20X4 is:

AA$75,758.

BA$66,667.

CA$150,000.

DA$132,000.

Show Suggested Answer

Suggested Answer: A

by Emilio at Jun 22, 2024, 06:23 AM

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Laticia

12 months ago

I'm feeling a bit 'foreign' to this exchange rate stuff. Maybe I should just 'convert' my answer to a lucky guess.

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Abraham

11 months ago

I agree, the exchange rates can be confusing but I also believe it's A) A$75,758.

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Leonor

11 months ago

I think it's A) A$75,758.

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Jame

12 months ago

I see where you're coming from, Hector. It's important to consider the exchange rates when determining the value of goodwill in a foreign currency.

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Silva

1 years ago

Goodwill? More like 'good riddance' to this tricky exchange rate question!

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Ezekiel

1 years ago

I'm going to go with the 'exchange rate at the date of acquisition' approach. Time to put my foreign currency knowledge to the test!

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Hector

1 years ago

I believe the correct answer is B) A$66,667 because we need to convert the B$100,000 using the exchange rates given.

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Nell

1 years ago

I agree with Rikki, the exchange rates provided are crucial in calculating the value of goodwill.

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Josphine

1 years ago

Wow, this is a real exchange rate conundrum! I'm just hoping the answer isn't 'D) A$132,000' - that would be too easy.

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Chau

11 months ago

I think it's A) A$75,758 too.

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Dean

11 months ago

A) A$75,758.

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Rikki

1 years ago

I think the answer is A) A$75,758.

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Eric

1 years ago

Wait, hold up! Shouldn't we be using the exchange rate from the acquisition date, not the year-end rate? I'm going with C) A$150,000.

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Izetta

1 years ago

Hmm, I'm not sure about this one. Maybe the answer is B$66,667 since that's the equivalent of B$100,000 at the 1.5 exchange rate.

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Reynalda

1 years ago

I think the answer is A$75,758. The exchange rates provided show that the goodwill of B$100,000 at acquisition would be worth A$132,000 at the year-end exchange rate.

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Dahlia

12 months ago

I agree with the first user, A$75,758 seems correct.

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Michell

12 months ago

I think it's A$66,667.

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Deonna

12 months ago

I believe the answer is A$75,758.

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