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Hi
If fair value of the non controlling interest is known then its Cost of investment + Fair value of the non controlling interest less 100% of sub’s equity
If fair value of the non controlling interest is not known (or given) then its Cost of investment less the % of equity you are aquiring.
I hope this is a little clearer and besides my last post was incorrect (so please ignore it) with regards to calulating goodwill “if the fair value of nci is not known” apologies for any confusion.
Regards
Hi
If fair value is known then its Cost of investment + Fair value less 100% of sub’s equity
If fair value is not known (or given) then its Cost of investment less the nci % of equity.
Regards
is it goods in transit or cash in transit?
If i sold goods to my subsidiary, i would raise an sales invoice, the invoice would have a date.
I would record the sales invoice at that date……… the subsidiary should record the same invoice, now a supplier invoice at the same date. So parent debtor a/c and subsidiary a/c should agree…… Unless there is missing paperwork, but that could be very quickly dealt with by reconciling the accounts.
If its cash (normally bacs or cheque) it will still have a date (payment date), the parent would treat it as money yet to clear on the bank statement. Debit bank $6000 Credit Debtors $6000, this balances the parent to subsidiary debt. in effect making an allowance for it… it would be odd to own, say 70% of a subsidiary and them to bounce a payment.
Think about the accrual concept of accounting and the transactions between parent & sunsibdiary, if its a sale in one, it must be a purchase in the other & vise versa … same applies for payments/receipts
Hope this helps
