SBRHow to calculate FV of NCI if not given in the question

You should calculate the goodwill by the old method (using Net assets share) if FV of NCI is not given because both methods are now allowed.

But as far as I understood in the question on exam it will be stated somehow the way of goodwill calculation.

The FV of NCI for full goodwill method will be given in the exams.

In your example its possible to calculate FV of NCI using % of NCI and FV of Net Assets. But this method is called Proportinate, Net Godwill or Partial Goodwill.

FV of Consideration 80% 100
FV of NCI 20% 7.8 (20% x 39)
FV of Business 100% 107.8
FV of NA (39)
Goodwill at Acq 68.8

Thanks alot

Look at the course notes for F7 to see the various ways in which nci goodwill can be calculated

If parent acquired 100% of subsidiaries then how can we find FV of NCI for example: Pco acquired 100% of the share capital of Sco on 1 September 2005 for $144,000, on which day the retained earnings of Beta were $34,560 and the fair value of the non-current assets was $36,000 more than their carrying value.

Salama there is no NCI for 100% owned Subsidiary. That sounds like you are doing a question from the BPP Textbook, it will have the answer you need. But there can be no minority interest if the company holds 100% of the shares.

BS date (SC+RE+OCE+other adjustment)*NCI%+NCI goodwill

Hi, can you please help me to find goodwill for this question, Jolly acquired 90% of the share capital of Roger on 1 January 2010 for $51,840. Roger was incorporated on that date.On 31 December 2012 the company’s Statements of Financial Position were as follows: Jolly Roger Non-currentassets $168,000 $ 86,400 Investment in Roger at cost$51,840 Current assets $64,800  $36,000 Share capital – $1 shares $148,800 $57,600 Retained earnings $107,040 $46,800 Current liabilities $28,800  $18,000 What amount should appear for goodwill in the consolidated statement of financial position? Zero, $51,840 $46,800 $57,600

Salama, The formula for calculation of goodwill is: consideration + NCI - FV of net assets = goodwill Here you have: * consideration = 51.840 (the amount paid by Jolly) * FV of net assets = share capital + RE at the date of acquisition. Here at the date of acquisition Roger was incorporated, so the RE were 0 at that date, but the share capital was the same as it is now, ie 57.600 * NCI - as there is no FV of NCI given you calculate is as a % of the FV of net assets; so it will be 10% * 57.600 = 5.760 So we have: 51.840 + 5.760 - 57.600 = 0 There you go :)

Salama, are you really a P2 student? The questions you are asking would embarrass an F7 student and would not be far beyond the capacities of an F3 student!

I am F3 student, actually I ask this question because one of my friend argue me with this question. And Thanx all for your kind help.

If Salama is an F3 student, why is he/she posting an F3 question on a P2 forum? Very strange!