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- February 24, 2022 at 2:12 pm #649281
Watts Co acquired 70% of the share capital of Pilkington Co on 1 January 20X2 for
$300,000.
The goodwill arising on consolidation has been impaired by $50,000 as at 31 December
20X5.
The share capital and reserves of the two companies as at 31 December 20X5 were as
follows:
Watts Co Pilkington Co
Share Capital $400,000 $150,000
Retained earnings $300,000 $200,000
At the date of acquisition Pilkington Co had retained earnings of $125,000. Watts Co
measures the non-controlling interest as the proportion of net assets of the subsidiary.
In the consolidated statement of financial position of at 31 December 20X5 what amount
should appear for the non-controlling interest?
My answer is coming $90000. Is it right?
Please help in this oneFebruary 24, 2022 at 5:31 pm #649287Consideration 300,000
NCI ( 30%* 275,000) 82,500Less sub’s NET ASSET at acq. date (275,000)
107,500
Less Impairment (50,000)GOODWILL 57,500
NCI:
82,500
22,500(30%*75,000)(15000) (30%*50,000) Impairment
90,000 Total
You’r right!
Bye - AuthorPosts
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