Helta Ltd acquired 100% of the share capital of Buzz Ltd on 1 January 2021. On that date, Helta Ltd began implementing a major change in the nature of Buzz Ltd’s trade. The trading profits/(losses) of each company for the two years ended 31 March 2021 are: Buzz Ltd Year ended 31 March 2020 80,000 Year ended 31 March 2021 100,000 Helta Ltd ££ 20,000 20,000 The profits and losses are generated evenly throughout these periods. Neither company has any other income or gains, nor any other associated companies. Required: State, with supporting calculations, how relief is obtained for Buzz Ltd’s loss of £100,000, on the basis that the companies claim relief for losses as soon as possible.
Helta Ltd acquired 100% of the share capital of Buzz Ltd on 1 January 2021. On that date, Helta Ltd began implementing a major change in the nature of Buzz Ltd’s trade. The trading profits/(losses) of each company for the two years ended 31 March 2021 are: Buzz Ltd Year ended 31 March 2020 80,000 Year ended 31 March 2021 100,000 Helta Ltd ££ 20,000 20,000 The profits and losses are generated evenly throughout these periods. Neither company has any other income or gains, nor any other associated companies. Required: State, with supporting calculations, how relief is obtained for Buzz Ltd’s loss of £100,000, on the basis that the companies claim relief for losses as soon as possible.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Helta Ltd acquired 100% of the share capital of Buzz Ltd on 1 January 2021. On that date, Helta Ltd began implementing a major change in the nature of Buzz Ltd’s trade. The trading
Buzz Ltd Year ended 31 March 2020 80,000 Year ended 31 March 2021 100,000
Helta Ltd ££ 20,000 20,000
The profits and losses are generated evenly throughout these periods.
Neither company has any other income or gains, nor any other associated companies.
Required: State, with supporting calculations, how relief is obtained for Buzz Ltd’s loss of £100,000, on the basis that the companies claim relief for losses as soon as possible.
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