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Hi everyone,
I’m new to ACCA and studying F3.For calculating Goodwill, we have this formula :
Good will = Consideration transfered + NCI fair value – Net assets recognizedI don’t understand why we plus with NCI.
Thank for your help!Consideration is what the parent company paid for their share of the subsidiary. Fair value of the NCI at the date of acquisition is the value of the remaining share. Add the two together and you have the total value of the subsidiary at the date of acquisition.
I do suggest that you watch our free lectures – they are a complete free course for Paper F3 and cover everything needed to be able to pass the exam well.
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