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Hi, I wanted to know example 2 in Chapter 23.
Why for calculation of NCI was post acquisition profit and not Parent Company cost as the previous example.In future you must ask in the Ask the Tutor Forum i f you want me to answer – this forum is for students to help each other.
In example 1, P acquired the shares on the date of incorporation of S. So the NCI is their proportion of the share capital plus their share of the profits made since.
In example 2, P acquired the shares later. S had already made profits and so the value of the NCI at the date of acquisition was higher than just their share capital. The question tells us the value of the NCI at the date of acquisition, so we just need to add to it their share of the profits since acquisition.
Have you watched the lectures that go with the lecture notes? The notes are only lecture notes and it is in the lectures that I explain and expand on the notes. If you are not watching the lectures for any reason then you need to buy a Study Text from one of the ACCA approved publishers and study from there.
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