Black Ltd Acquired 75 % of White Ltd on 1

Multiple Choice

Black Ltd acquired 75 % of White Ltd on 1 January 20X1 by paying $5 000 000 cash.At that date, the equity section of White Ltd's balance sheet was as follows:
$\begin{array}{llcc}&\$\\ \text {Share capital } &1000000 \\ \text { Retained profits} &3000000\\ \text { Asset revaluation reserve } &500000\\\end{array}$


All assets and liabilities were recorded at their fair values.During May 20X1 White Ltd paid a total dividend of $1 000 000 out of profits earned before 1 January 20X1.Under the full method, the fair value of NCI was assessed as being $1 250 000.
How much consolidation goodwill will be reported by the Black group ?

A) $1 000 000
B) $1 125 000
C) $1 625 000
D) $1 750 000