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Sir . I read your notes and I found at no investment should be recorded in the consolidation accounts however, in kaplan, there was an investment in the parent which was $98,000 and 60% of the subsidiary share was bought paying cash of $76,000. And loan note monies was borrowed by the sub from the parent which was $20,000.
At consolidation , the inevestment was accounted for as $98,000 – $76,000 – $20,000= $2000. And this figure was added to the total asset at consolidation. Is this acceptable ?Why on Earth would this not be acceptable?
If the parent had invested $300,000 in the acquisition of a subsidiary and a further $45,850,000 buying a Van Gogh painting giving a total figure for investments of $46,150,000, are you seriously suggesting that my notes say “Ignore the $45,850,000 because no figure for investment should appear in the consolidation”
Is that really what you think that I said?
Really?
Or did I say that the investment cost figure shouldn’t appear in the consolidated statement of financial position?
Clear?
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