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I have got a little confused with (w3) and (w4a) in this question. Why are we doing the workings twice? is this because of the fact that the acquistion was made over 1yr ago and the accounts need to be adjusted?
Many thanksW3 is to calculate Consolidated Retained Earnings whereas w4 is to calculate the nci value at consolidation date
Does that answer it?
I have got the hang of what the workings are for, however in the chapter with the answers to the examples, example 5 has (w3) split into (a) and (b) and the same happens for (w4). (a) is retained earnings brought forward(w3a)/nci brought forward (w4a) then (b) is retained earnings carried forward(w3b)/nci brought forward (w4b)
I have done (w3b) using the carried forward figures but don’t see the need for (w3a).
With (w4) I have done (w4b) but not (w4) or (w4b)
The ones that have been omitted don’t seem to be necessary to the question, when would we use these ones and why?
I am actually going through this paper as I studied it around 3 years ago and passed but need to come up to speed to study for P2 this June.
Many thanks
The calculation is to show that it is possible to get full information to be able to prepare a statement of changes in equity. For F7, a statement of changes is not required FOR QUESTION ! the consolidation question but could well be required in question 2, the preparation of financial statements question.
I simply go through the mechanics to illustrate how to arrive at the brought forward amounts for that statement with the intention of illustrating how to do it should it be required in question2
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