Beach Limited is a subsidary of Golden Limited. When Golden acquired its 70% interest in Beach,...

Beach Limited is a subsidary of Golden Limited. When Golden acquired its 70% interest in Beach, the retained earnings of Beach Limited were $40,000.

At the beginning of the current period, Beach Ltd’s retained earnings had increased to $100,000.

Beach also earned profit of $20,000 during the current period. The NCI’s share of the equity of Beach Ltd at reporting date is: (Please provide step by step solutions, thank you!)

a. $36,000

b. $30,000

c. $6,000

d. $84,000

Solutions

Expert Solution

Working Notes:
	CALCULATION OF SHARE % OF NON CONTROLLING SHAREHOLDERS

	Total Shares	100%
	Less: Shares acquired by Golden Limited	70%
	Balance Shares is for non controlling Interest (NCI)	30%

Solution:
	CALCULATION OF NON CONTROLLING INTEREST IN THE NET INCOME OF DEMERS

	Earned Profit of the year	$ 20,000
	Add: Beginning balance of Retained Earnings	$ 1,00,000
	Ending balance of Retained Earnings	$ 1,20,000
	Share of NCI in Beach Limted	30%
	Share of NCI in $ = $ 120,000 X 30% =	$ 36,000


Answer = Option A = $ 36,000

ekkarill92 answered 1 year ago

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