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I just want to know on the answer to question 4, how were the fractions arrived at?
Is this the question with 10/15, 2/15 and 3/15?
10/15 is easy – it’s 2/3 of the number of shares.
2 / 15 is calculated by finding the amount of the cost of the investment by the parent so it requires a little working to discover that the parent spent 80,000 on the acquisition and the shares cost $2 each so that makes 40,000 shares acquired out of a total of 300,000 = 2/15
OK?
Yes thats the Question.Is the 2/3 coming due to the fact that the two companies acquired Liene,you no why am confused its because the question didnt state the number of shares purchased by the two copmanies.
No, but the question shows you how much is in Anda’s and Kristina’s balance sheets as investments, and we know the shares cost $2 each so …….. we can work out how many shares were acquired!
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