In: Accounting
Noncontrolling interest appears in the financial statements of:
the parent company and the consolidated financial statements
the consolidated financial statements only
the subsidiary company and the consolidated financial statements
the parent company only
Answer :
Non Controlling Interest is the ownership position of investors in subsidiary company other than the Parent Company. The amount of Non Controlling Interest in subsidiary company is not owned by Parent Company.
The amount of Non controlling interest appears in the consolidated financial statements in the shareholders' equity section separate from the equity attributable to parent company.
In above question :
First option says that Non controlling interest appears in the financial statements of the parent company and the consolidated financial statements which is wrong because Non controlling interest appears in consolidated financial statements only.
Second option says that Non controlling interest appears in the the consolidated financial statements only which is correct.
Third option says that Non controlling interest appears in the financial statements of the subsidiary company and the consolidated financial statements which is also wrong because Non controlling interest appears in consolidated financial statements only.
Fourth Option says that Non controlling interest appears in the financial statements of the parent company only which is also wrong because Non controlling interest appears in consolidated financial statements only.
So, Correct Option is :
Second option, Non controlling interest appears in the the consolidated financial statements only.