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MikeLittle.
MikeLittle.-
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seista
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Sir can u please explain me the following
1) the retained earnings stated in the summarised finan. Sta. In the question
Is it the current year retained earnings ?2) in the answer part when we prepare csof changes in equity , how do we arrive at the amount 175000 on disposal
3) why are we deducting 33500 from retained earninga in statement of c in equity
Please do help me i have been struggling with this question
MikeLittle
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Hi
1) The retained earnings figure in the statement of financial position (635,000) is as at the year end 30 June, 2009
The retained earnings figure as at the foot of the statement of profit or loss ((33,500)) is the loss for the year ended 30 June, 2009
2) We owed the nci at the start of the year $162,750 (25% x 700,000 – 49,000) shareholders’ equity brought forward
The nci is also entitled to their share of this year’s subsidiary retained profits $12,250 (25% x 49,000)
So as at the year end, the date we disposed of the subsidiary, we owed the nci $175,000 ($162,750 + $12,250)
And that’s where the $175,000 comes from
3) The group made a consolidated loss for the year of $33,500 …. and that’s why we deduct $33,500 from the retained earnings in the group statement of changes in equity
OK now?
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