- This topic has 4 replies, 2 voices, and was last updated 8 years ago by
.
- Posts
Hi everybody,
I m trying really hard to understand the share exchange on acquisition.
Questin 1 Flue and Preys plc on revision test.Please can someone could share the working of cost of acquisition and the whole share exchange thing in the question. This is my first question of this kind I am attempting.
Also, is there any particular format to write certain numbers down.
Just for finding one particular share price, I am actually reading the whole question a lot of times!I have just found chapter8 page53 illustration to understand this.
thanks in advance.
Chapter 8 page 53 is a past exam share exchange question and I go through it logical step followed by logical step.
If you still struggle post again on the Ask ACCA Tutor forum and that way I shall be certain of seeing your post and shall reply
Thank you for all the help Mike.
Share exchange makes more sense to me now.(1)the question says fair value of nci investment is the fair value of the shares held by them?
what is the fair value of the shares ?£1.00 ?(2)Chapter 8 page 53 nci is 2500 as i calculated as there are no figures for parent’s share of post acq. R.E.
Is that correct?
The total value of Greca, as suggested by solution answer , is 55500. i understand all the share exchange figures just the nci value i am trying to get to.
How do we get to that figure.(3)I know the questin does not ask for value of goodwill.
still g/w in the same question would be
(6000+33000+14400 + value of nci 4500) =57900
fv of sna @doa is 10000+3500057900 – 45000 – 12900 . would that be correct
Thanks you for all your effort to provide answers to my silly questions!
I think these are very basic things i should know!hi,
I have done a bit of share exchange on Ausre and Danute chapter 9 page 55
and I have realized that fair value of nci based on fair value of shares would be the market value of share on doa.“2)i understand all the share exchange figures just the nci value i am trying to get to.”
“Chapter 8 page 53 nci is 2500”
Do I understand you correctly here? You don’t know where $2,500 for the nci comes from! And yet, at the start of your point 2), you state “Chapter 8 page 53 nci is 2500”
What I don’t understand is the relevance of your comment “as there are no figures for parent’s share of post acq. R.E.”
How will the parent’s share of Greca’s post acquisition retained earnings have any possible affect on the value of the nci as at date of acquisition?
That’s like saying “Because I don’t know the price of fish, I am not able to determine how many hotel rooms are available in Basra at any point in time”
“(6000+33000+14400 + value of nci 4500) =57900” – you’ve just worked out that value of nci is $2,500, not $4,500!
“57900 – 45000 – 12900 . would that be correct” – that would be correct if you changed value of nci to $2,500 and total figure from $57,900 to $55,900. Otherwise, it’s spot on!
- You must be logged in to reply to this topic.