Changes in the Composition of a Group Example 2

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Comments

  1. avatar says

    Hello Mike,
    I was of the of the opinion that we would need to add the $84k retained earning profit for the year to the $820k but you treated it otherwise. Please could you shed more light on this. Thanks. Regards . David

    • avatar says

      @oladimeji01, $84k RE for the year is already included in RE of $820k..ok, let me put it this way..what’s the sequence of preparing conso. Fin Statements? it will be CS of Comprehensive income, CS of Fin Position, CS of CIE..so there you go..i hope this helps.. :D

      • Avatar of MikeLittle says

        @mizanm, David, you’re given the retained earnings figure to CARRY FORWARD. That’s 820. But included within that figure is this year’s profits so, when calculating retained earnings brought forward ( or even when calculating retained earnings at date of a mid-year acquisition ) we need to deduct “this year’s retained earnings” from the carry forward position to get back to the brought forward position.

        If it’s a mid-year acquisition, we need then to time apportion the 84

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