ACCA FR · Guided practice (Show me how)
Chapter 23: Consolidated statement of financial position
Consolidated SFP - goodwill, NCI (both methods) and the workings
Consider the following acquisitions.
(a) Goodwill. A parent company buys 75% of the equity shares in a subsidiary for $156,000. The remaining shares were valued at $52,000 and the net assets at acquisition were $170,000.
(b) Matthews purchased 80% of Jones for $600,000 two years ago, when Jones's retained earnings were $100,000. Matthews measures the non-controlling interest (NCI) using the fair value method; the fair value of the NCI at acquisition was $200,000. Statements of financial position at 31 December 20X5 ($000):
(a) Goodwill under both NCI methods
Calculate the goodwill arising on acquisition under the proportionate share of net assets and fair value methods of measuring non-controlling interest.
(b) Matthews: the workings and the consolidated figures
Calculate Jones's net assets at acquisition and the Matthews group's goodwill, non-controlling interest, retained earnings and consolidated total assets at 31 December 20X5.
Opening this exercise…