Transfer of Non Current Assets Lecture

Hi Mike
Apologies for raising this query on the lecture site rather than “ask the tutor”. Just thought it might be quicker than referring back to the lecture example. My query is if the example above had made the exact same transaction but from the sub to the parent (i.e. PUP of 10 on sale less the excess of 5 on dep’n now in parent company) then the net effect is now a reduction in the sub rather than parent – Dr Ret Earn, CR TNCA etc.

Does the sub now present as follows on the consolidated statement of retained earnings (for the sub);

Per Question 600
Pre Acq (275)
Less: PUP (5)
Post Acq 320

This would leave post-acq for parent as 60% x 320 = $192,000. I’m assuming this is correct as the 600 would (theoretically) already incorporate the accelerated depn etc. Equally the NCI of 40% in W4 would then be 40% x 320 = $128,000.

Many thanks for your help in advance and many thanks for getting me through my F4 paper last month too!

Kindest Regards

Chris

PS – Apologies for duplicating as also raised this query on the lecture comments too!