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Hi Mike,
I have some difficulties when I go through Grange. Need your smart explanation 🙂
1. I just notice this Q has year end date (Nov. 30,2009) share of NCI sold out and acquisition by holding company. But why we still use previous share percentage to calculate post-acqn share of P (60%) and F (100%) for group R.E., when calculating NIC, we recognize NCI for newly updated shares ( P sold out 20%, F act from G 25%), seems inconsistent.
2. From item v, why R.E less provision 1+6, the questions not indicating clearly the provision decreased this year’s profit.
3. in the answer sheet, working 9 restructuring, impairment of investment in Sitin (16-13), where comes from 16???
Thanks,
Qin1a) Because throughout the year, Grange held 60% so, for the entire year, Grange was entitled to just 60% of Park’s activities / results
1b) Again, throughout the full year, Grange held 100% and only sold on the last day of the financial year
2) Well, where else are you thinking of putting the debit entry if it’s not to this year’s profits / retained earnings?
3) It’s the apportioned cost of the remaining 40% investment. 100% cost $39m, the remaining holding in Grange own records is 40% of that $39m = $15.6m = (rounded) $16m
Hi Mike,
Thank you for all three points.
I am just thinking the influence on R.E. and OCE in consol when there is any equity change in AFS, asso, and subs.
Please GIVE MORE CLEAR EXPLANATION for my below understanding:
I: When H retains the control or no substance change of AFS, asso, subs,
a) I mean for example, H only acqs or sells shares with NCI, and subs is still subs. The positive or negative equity movement is in OCE, no change in R.E. when Cosolb) AFS, asso are still the same, any gain or loss in F.V. change, or impairment of C.V.is in OCE?
II: When H losses control or gain control, Subsi to Asso, AFS to Asso, or any changes among them three, equity movement should be in R.E.?
Thanks,
QinQin, these situations are all dealt with in the course notes and within lectures (I believe) and for me to type an answer is going to take me through to mid-June.
In addition, there is an article by the P2 examiner in Student Accountant from around 2 years ago explaining his take on these situations
But, as ever, having done your own studying and you still have a problem, post again
LOL, okay. I will try to study first by myself and back to you if still have some real one.
What a happy day after studying your answers.
Qin
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