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William Company acquires 70 per cent of Bill Company for a cash price of $10,000,000 when...

William Company acquires 70 per cent of Bill Company for a cash price of $10,000,000 when the share capital and reserves of Bill Company are:

Share capital                        $8,000,000

Retained earnings               $2,000,000

TOTAL                                   $10,000,000

  1. What amount will be shown in the consolidated statement of financial position for goodwill pursuant to AASB 3 assuming that any non-controlling interest in the acquirer is measured at fair value?

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  1. What amount will be shown in the consolidated statement of financial position for goodwill pursuant to AASB 3, assuming that any non-controlling interest in the acquirer is measured at the non-controlling interest’s proportionate share of the acquiree’s identifiable net assets?

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  1. What are some of the implications of allowing the group to have two options in accounting for goodwill on consolidation?

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ekkarill92 answered 1 year ago
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