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Dear Sir
I hope this message finds you well.
First of all Thanks for recommending your videos, they were very useful.
I am having some difficulty with a question I found in the BPP question bank as I can find no mention of percentage ownership of the Subsidiary’s share capital:Am i correct in thinking if the question doesnt give a percentage, the sum of
the Investment made in the Subsidiary company’s ordinary shares at cost (‘A’)
and the fair value of the Non-controlling interest (‘B)
should equal 100% of the companyand therefore A / (A+ B) X 100 should give percentage ownership?
Is there another way to calculate percentage ownership ?
thanks for your time
all the bestplease ignore the above message.
I found what I missed
apologiesps for any future students reading this message
check the number of SHARES bought BY the parent company and then compare that number to the Subsidiary’s total shares
that will give you a percentage ownership
all the bestWhat you have said in your second post is correct.
The % ownership is based on the % of the subsidiaries shares that are owned by the parent company.
what if we are only supplied with the amounts of cash not number of shares?? please help
Investments P=1000
Share capital S’=760
Retained earnings S’=1460You will have to either be given the % or given the number of shares.
If you have a question in your Revision Kit that you think does not give you the information then tell me which one and I will explain.
investments: 3345
shares : parents 9000 R.E 525
share: sub’s 4000 R.E 200
parents purchased 2800 shares a year ago
sub’s R.E 60000
NCI at date of acq 1415WHAT IS THE PARENT’S AND SUB’S PERCENTAGE
If the parent owns 2,800 shares in the subsidiary, and if the subsidiary has 4,000 shares, then the parent owns 2,800/4,000 = 70%.
There is no such thing as a ‘subsidiaries %’. The Non Controlling Interest own 30%.
I suggest that you watch my free lectures. The lectures are a complete free course and cover everything need to be able to pass the exam well.
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