This topic contains 1 reply, has 2 voices, and was last updated by 
John Moffat 1 year, 2 months ago.
- Posts
- March 6, 2018 at 11:21 am
You mentioned that the Fair Value of Non-Controlling Interest will normally be provided in the exam. If it doesn’t, did you say it is to be calculated as: 40/60 x 40,000 (in the example in the lecture).
If so, this doesn;t equal 30,000 as it stated in your example.
Clarity would be appreciative!
March 6, 2018 at 12:15 pmIf the value is given (as it is here) then you use that value.
We would only take 40/60 x 40,000 if we were not given a true fair value, because we would be unable to continue otherwise. However there is no reason in real life why the true fair value should be 40/60 x 40,000 (a smaller holding is likely to have a lower value).
You must be logged in to reply to this topic.