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Hi sir Mike..
I got some confusion in NCI.
NCI in sofp appears as value of NCI at DOA + NCI share of retained earnings post acquisition + Nci share of revaluation reserve post acquisition – dividends paid to NCI.
Now I got confused on the “Plastik & Subtrak” F7 question
what I did for NCI was 4,500 + (20% x 900) = 4,650
but why was the answer 4,800?
The answer key shows :
Non-controlling interest in statement of financial position
At date of acquisition 4,500
Post-acquisition from statement of profit or loss and other comprehensive income 300 –––––––
4,800why did they take 300 instead of 180?
Thank you sir.
“what I did for NCI was 4,500 + (20% x 900) = 4,650”
Where did you get $900 from?
And 4,500 + (20% x 900) does not equal $4,650!
oh sorry, I meant 4,680. I got 900 from the subsidiary’s side of group retained earnings.
subtrak:
Year end 3,500
at acquisition (2,000)
post acquisition 1,500consolidation adjustments
excess depreciation (100)
goodwill impairment (500)profit subsidiary 900
attributable to group : 80% x 900
attributable to NCI : 20% x 900..that’s where i got 900 from.. because in the previous question I did (Zanda), I calculated NCI with the percentage NCI from this profit subsidiary and got correct..
Why are you charging the nci with 100% of the goodwill impairment?
“post acquisition 1,500
consolidation adjustments
excess depreciation (100)
goodwill impairment (500)”Surely we should only deduct 20% of $500 from the nci and that $100 adjustment is made in the working W4A (nci on SoFP) and not in the subsidiary’s retained earnings calculation
And why have you not adjusted Subtrak’s post-acquisition gains for the $600 increase in the property valuation achieved post-acquisition?
$1,500 post acquisition retained (agreed)
$(100) excess depreciation (agreed
$600 property value increase post acquisition (you’ve missed it)Therefore $2,000 post acquisition in Subtrak
Nci at acquisition date 1,800 shares x $2.50 = $4,500 (agreed)
Share of post-acq retained 20% x $2,000 = $400
Less 20% of goodwill impairment 20% x $500 = $(100)NCI on SoFP $4,800
OK?
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