CIMA Exam CIMAPRA19-F02-1 Topic 3 Question 112 Discussion

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

Question #: 112
Topic #: 3

AB acquired its one subsidiary, CD, on 1 January 20X1. At this date the fair value of CD's property, plant and equipment was found to be $40 million higher than its carrying value. The relevant items had a remaining estimated useful life of 10 years from the date of acquisition.

At 31 December 20X4 AB and CD presented property, plant and equipment of $100 million and $50 million respectively in their individual financial statements.

The value of property, plant and equipment presented in AB's consolidated statement of financial position at 31 December 20X4 is:

A$174 million

B$190 million

C$150 million

D$134 million

Show Suggested Answer

Suggested Answer: A

by Krystal at Jun 13, 2025, 06:02 AM

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Hillary

7 days ago

The answer is clearly B) $190 million. The fair value of CD's property, plant and equipment was $40 million higher than its carrying value, and this difference should be amortized over the remaining 10-year useful life. Simple math, really.

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