BPP Revision kit Q2

Moderator: Bluewednesday

BPP Revision kit Q2

Postby nivya » Tue Dec 01, 2009 10:20 pm

Hi All,

Can anybody please confirm that the answer to Q2 part a)Coral quetion in BPP revision kit is incorrect. Is it just a typo??Based on the calculation should it not be just Reef ltd making the contribution?

Thanks
User avatar
nivya
 
Posts: 117
Joined: Mon Aug 02, 2004 4:39 pm
Location: UK
Has thanked: 0 time
Been thanked: 0 time

Re: BPP Revision kit Q2

Postby Bluewednesday » Wed Dec 02, 2009 10:06 am

I thought my kit had a mistake in it so I emailed the author (email address in the front of the kit) and to my embarrassment I was wrong!

If you want to be sure, email the author as I did and they can explain if it is a typo or not and they answer pretty quickly.
bluewednesday
User avatar
Bluewednesday
 
Posts: 2859
Joined: Mon Mar 15, 2004 2:43 pm
Location: Milton Keynes
Has thanked: 0 time
Been thanked: 2 times

Re: BPP Revision kit Q2

Postby alamode » Mon Dec 07, 2009 1:10 am

Yeah looks wrong to me.. But the conclusion to me seems right and the calculations seem wrong to me.

I mean, Why are they calculating the Corporation Tax saved on dividends paid? If Reef Ltd pays a dividend of 9000, They wont be saving Corporation Tax on this 9000.. or would they? I dont think they would. So if reef ltd pays a dividend of 9000, The cost of the dividend is 9000.

Similarly in the 2nd computation, Coral will make contribution of 4416 and reef will pay 3480 dividend. Again they have calculated tax saving on 3480.. I dont think there will be any tax saving so cost of 9000 pound pension contribution should be 4416+3480

And hence the 2nd computation results in lower cost.

Anyway.. Good luck tomorrow.. If anyone reads this, Please confirm if im right or wrong.
alamode
 
Posts: 955
Joined: Tue May 13, 2008 2:37 am
Has thanked: 0 time
Been thanked: 0 time

Re: BPP Revision kit Q2

Postby alamode » Mon Dec 07, 2009 1:15 am

http://www.eaib.cn/ACCA/历年考题/P6/p6uk_2007_dec_a.pdf

Thats the link for the solution from ACCA for this question..

They have deducted the CT on dividends.. I cant understand why.. Maybe im missing something :S
alamode
 
Posts: 955
Joined: Tue May 13, 2008 2:37 am
Has thanked: 0 time
Been thanked: 0 time


Return to P6 Advanced Taxation ATX

Who is online

Users browsing this forum: No registered users and 1 guest

cron

Accountancy Students

© 2013 Accountancy Students. All rights reserved.