New! Lectures for ACCA AAA September 2022 Exams are now available >>

New! BPP Books for ACCA September 2022 Exams are now available, get your discount code >>

Consolidated Financial Statement

This topic has 3 replies, 2 voices, and was last updated 9 months ago by John Moffat.

Viewing 4 posts - 1 through 4 (of 4 total)

Author

Posts
September 11, 2021 at 5:32 pm #635531
maximus07
- Topics: 374
- Replies: 379
In Lecture of Chapter 23, Second example.
You calculated value of Subsidiary (P’s Investment + Non-Controlling interest) and then compared to entire Share Capital and all Retained earnings to find Goodwill.

My question is that why we can not do by just taking Investment by P only (excluding fair value of NCI) and comparing it with 60% of Retained earnings and 60% of Share Capital to find goodwill.
September 12, 2021 at 8:42 am #635564
John Moffat
Keymaster
- Topics: 57
- Replies: 49603
Because we want the total value placed on the goodwill of the subsidiary (just as we bring in the total value of all the assets in the subsidiary) – not just 60% of them.

Also, because this is the rule in the accounting standard and it not our choice 🙂
September 12, 2021 at 9:40 am #635575
maximus07
- Topics: 374
- Replies: 379
Thank you sir.
September 13, 2021 at 9:21 am #635633
John Moffat
Keymaster
- Topics: 57
- Replies: 49603
You are welcome 🙂
Author

Posts

Viewing 4 posts - 1 through 4 (of 4 total)

You must be logged in to reply to this topic.