Exam 12: Consolidation: Non-Controlling Interest

Alexandra Limited acquired 80% of the share capital and reserves of Heads Limited for $300 000. Share capital was $200 000 and reserves amounted to $100 000. All assets and liabilities were recorded at fair value except buildings which was recorded at $20 000 below fair value. If the company tax rate was 30%, and the partial goodwill method was adopted, the NCI share of equity at the date of acquisition was:

A gain recorded by a subsidiary on the sale of a non-current asset to another entity within the group will result in a debit adjustment to the NCI share of current year profit.

Ownership interests in a subsidiary entity that do not belong to the parent entity are known as:

The full effects of transactions between entities within a group are eliminated on consolidation, regardless of the existence of an NCI.

The NCI is entitled to a share of the consolidated equity of the group.

Which of the following statements is incorrect?

Which of the following statements is incorrect?

Where a partly owned subsidiary has a dividend declared but not yet paid at balance date, the NCI share of equity is reduced by the NCI share of the dividend and the dividend payable to the NCI is eliminated.

Moffatt Ltd holds a 60% interest in Beach Ltd. Beach Ltd sells inventories to Moffatt Ltd during the year for $20 000. The inventories originally cost $14 000. At the end of the year 80% of the inventories are still on hand. The tax rate is 30%. The NCI adjustment required in relation to this transaction includes which of the following?

The NCI is not allocated a share of any BCVR balances where business combination valuation entries are recorded on consolidation, rather than in the subsidiary's books.

Which of the following statements is correct?

The non-controlling interest columns on a consolidation worksheet are used to:

Currimundi Ltd holds a 60% interest in Beach Ltd. Beach Ltd purchases inventories from Currimundi Ltd during the year for $30 000. The inventories originally cost $21 000. At the end of the year 80% of the inventories are still on hand. The tax rate is 30%. The NCI adjustment required in relation to this transaction includes a debit of which of the following?

Under the conceptual framework for international financial reporting a non-controlling interest fits the definition of:

According to AASB 10/IFRS 10 Consolidated Financial Statements, a non-controlling interest is classified as:

Jack Limited acquired 80% of the share capital and reserves of Jill Limited for $300 000. Share capital was $200 000 and reserves amounted to $100 000. All assets and liabilities were recorded at fair value except buildings which was recorded at $20 000 below fair value. The fair value of the NCI at the date of Jack's acquisition was $70 000 and the full goodwill method is adopted by the group. If the company tax rate was 30%, the total goodwill in relation to this business combination amounts to:

The effect on consolidated current year profit of all intragroup transactions involving a partly owned subsidiary must be reflected in Step 3 of the NCI allocation process.

Which of the following is not one of the 3 steps in calculating the NCI's share of the recorded equity of the subsidiary?

The calculation of the NCI share of equity at a point in time is done in three steps.

According to AASB 10/IFRS 10 Consolidated Financial Statements, the term 'non-controlling interest' is defined as: