When computing for goodwill, the fair value of the
non-controlling interest is used rather than the book value. In doing this, the
NCI’s share of the net assets acquired is replaced with the fair value to
determine the goodwill.
Mom Plc acquired 68% voting rights of Daughter Plc on 1st
January, 20x1 when the reserves of the latter were N65million. The respective
statements of financial position of the two companies as at 31st
December, 20x2 are as follows.
If the fair value of the non-controlling interest is
estimated to be N142million as at 31st December, 20x2, prepare the
consolidated statement of financial position.
Suggested solution
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