Mild mannered Janitor wrote:Classic example of someone who doesn't know what they are talking about.
£1.6m of intangible was crearte, not purchased separately.
Dr intangibles Cr REVALUATION RESERVE.
This reserves goes directly to the equity (shareholders fund) section of the Balance sheet and completely avoids the P/L ac
You are confusing accumulated losses with a debt (liability to pay out). The £2m of losses were not liabilities, but the result of all profits less losses from incorporation to that point in time. Since that point in time those losses have increased by a further £0.7m
Mild mannered Janitor wrote:Classic example of someone who doesn't know what they are talking about.
£1.6m of intangible was crearte, not purchased separately.
Dr intangibles Cr REVALUATION RESERVE.
This reserves goes directly to the equity (shareholders fund) section of the Balance sheet and completely avoids the P/L ac
You are confusing accumulated losses with a debt (liability to pay out). The £2m of losses were not liabilities, but the result of all profits less losses from incorporation to that point in time. Since that point in time those losses have increased by a further £0.7m
It really is that simple.
I am not confusing accumulated loses with a debt. What I was asking is where have the accumulated loses of £2.7 million come from? Barista recons there were accumulated loses of £2million showing on the 2011 accounts. Clearly not true looking at the accounts.
goodwill and intangible assets are charged to the profit and loss account (income statement) in the periods in which they are depleted. When an intangible asset is disposed of, the gain or loss on disposal is included in profit or loss
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