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Hi
i need help calculating the percentage of NCI in the following question. Can you please assist with the question below:BPP revision kit question 133
Plateau MCQ case
On 1 October 20X6 Plateau acquired the following non-current investments :-3 million equity shares in Savannah by an exchange of one share in Plateau for every two shares in Savannah plus $1.25 per acquired Savannah share in cash. The market price of each Plateau share at the date of acquisition was $6 and the market price of each Savannah share at the date of acquisition was $3.25
– 30% of the equity shares of Axle at a cost of $7.50 per share.
With reference to the nci in Axle, Plateau IS the nci – they own 30% so someone else (singular or plural) owns the majority 70%
As for Savannah – it’s a 75% holding
All clear?
I may have worded this incorrect, I mean how do I calculate the percentage that the parent company has acquired in Savannah. So that I can calculate the NCI that would appear on the Consolidated FP. I have had a look at the answer and it has stated the NCI percentage is 25%. But I cannot seem to calculate how they got P—>S to be 75% ?
Can you please assist me further ? I look forward to your response.
How many shares did Plateau in Savannah?
What is the Savannah share capital?
Can you take it from there?
I am really sorry but I have been stuck on this question for 2 hours. If you could kindly tell me how you got the 75% in this question then I can know what to do next time. Please can you tell me how to calculate the acquired holding percentage I do not know what to do.
Riaa, these are the steps that you follow in every consolidation question
Ask yourself these two questions:
– How many shares did Plateau buy in Savannah?
– What is the Savannah share capital?
Can you take it from there?
If you can’t, ok post again and I’ll put it in words of one syllable … no worries
Hi Mike
I still cant get 75%. This is the furthest I can get.
P bought 1 for every 2, which gives me 3,000/2= 1,500.
Then S equity shares are 4,000.
4,000/1,500 = 2.667 ?? this is not 75%.Please can you help me to get to the 75% ?
Kind Regards,
Rita! P bought 3,000,000 Savannah shares
Savannah had 4,000,000 $1 shares in issue
If P bought 3,000,000 of that 4,000,000 what percentage is that?
What makes you think that the nci percentage in Savannah may be influenced by the number of shares that Plateau issues?
Better?
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