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Sir i have a doubt from consolidation sum in the kaplan text book the name of the sum is premier and sanford company i wont be able to paste the whole sum here is there a way you could still help me with this doubt
DOUBT – how is the retained earnings at acquisition date calculated and i check the answer to that sum (4,500 – (3900 × 4/12)) where does this 3900 come form?
Hi,
I believe that this question has been answered elsewhere on the forum previously. If memory serves me right the 3,900 is the profit for the year and we are deducting 4 months of the profit to work backwards from the retained earnings at the reporting date to the retained earnings at acquisition.
Thanks
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