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Hi
Can someone confirm this please ; Is post acquisition profit the increase in profit from the date of the pre-acquisition profit?
and if yes is retained earnings b/f + profit for the year – pre acquisition profit = post acquisition profit>?>Not necessarily! If a dividend has been declared and properly accounted for, it will not appear in the Statement of Income but will have been deducted in arriving at retained profit for the year.
So, Retained Earnings brought forward + profit for the year (per the Statement of Income) – any dividend paid / proposed for the year less retained earnings as at date of acquisition should give you the post acquisition profits (subject to any adjustments such as the elimination of pups)
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