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Consol. Statement of Changes in Equity BBP Revision Kit Q 32

This topic has 2 replies, 2 voices, and was last updated 9 years ago by triniaccountant.

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December 4, 2012 at 4:44 pm #56157
triniaccountant
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I have no idea how they came up with the opening retained earnings of [230 + (185×80%)] Can anyone help please?
Thanks.
December 4, 2012 at 5:32 pm #110139
nibhiadha
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Hi! The 230 comes from (Boo Retained Earnings) 500 less (Boo Profit for Year) 270. They have a 80% stake in Goose so 80% is taken of Goose’s Retained Earnings less Profit for the Year which is ((240 – 55) * 80%) = 148

Then the 230 is added to the 148 to get the opening retained earnings of 378.

Hope this helps! I’m not great at explaining things! Good luck tomorrow! 🙂
December 4, 2012 at 6:16 pm #110140
triniaccountant
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@nibhiadha said:
Hi! The 230 comes from (Boo Retained Earnings) 500 less (Boo Profit for Year) 270. They have a 80% stake in Goose so 80% is taken of Goose’s Retained Earnings less Profit for the Year which is ((240 – 55) * 80%) = 148

Then the 230 is added to the 148 to get the opening retained earnings of 378.

Hope this helps! I’m not great at explaining things! Good luck tomorrow! 🙂

Thanks this realllllly helps alot! Am I to gather that in any given scenario, where the question gives no additional information, I calculate opening retained earnings in this way?
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