Question

In: Accounting

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?

[Type Answer Here]

  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?

[Type Answer Here]

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

[Type Answer Here]

Solutions

Expert Solution

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

Assume that Company A acquires 70% of Company for a cash price of $10 million when...
Assume that Company A acquires 70% of Company for a cash price of $10 million when the share capital and reserves of Company B are: Share capital $8 million Retained earnings $2 million $10 million (a) 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 acquired is measured at fair value? (b) What amount will be shown in the consolidated statement of financial position...
Mwanza and Tasila are in Partnership. They share profits in the ratio: Mwanza 70 per cent...
Mwanza and Tasila are in Partnership. They share profits in the ratio: Mwanza 70 per cent ; Tasila 30 per cent. The following trail balance was extracted as at 31st December 2019.                                                                                                                         Dr                    Cr                                                                                                                         ZMK                ZMK Office equipment at cost                                                                               9,200 Motor Vehicle at cost                                                           ...
On 1 July 2014 Padma Ltd acquires 25 per cent of the issued capital of Jamuna...
On 1 July 2014 Padma Ltd acquires 25 per cent of the issued capital of Jamuna Ltd for a cash consideration of $360 000. At the date of acquisition, the shareholders’ equity of Jamuna Ltd is: Share capital $450 000 Retained earnings $300 000 Total shareholders’ equity 750 000 Additional information • On the date of acquisition, buildings have a carrying amount in the accounts of Jamuna Ltd of $240 000 and a market value of $300 000. The buildings...
On 1 July, 2018 Bundoora Ltd acquires 25 per cent of the issued capital of Preston...
On 1 July, 2018 Bundoora Ltd acquires 25 per cent of the issued capital of Preston Ltd for a cash consideration of $150,000. At the date of acquisition, the share capital and retained earnings of Preston Ltd are as follows: Share capital $120,000 and Retained earnings $480,000 (Total Shareholders’ equity $600,000). Additional information:  For the year ending 30 June, 2019 Preston Ltd records an after tax profit of $50,000 from which it pays a dividend of $30,000.  For...
On 1 July, 2018 Bundoora Ltd acquires 25 per cent of the issued capital of Preston...
On 1 July, 2018 Bundoora Ltd acquires 25 per cent of the issued capital of Preston Ltd for a cash consideration of $150,000. At the date of acquisition, the share capital and retained earnings of Preston Ltd are as follows: Share capital $120,000 and Retained earnings $480,000 (Total Shareholders’ equity $600,000). Additional information: For the year ending 30 June, 2019 Preston Ltd records an after tax profit of $50,000 from which it pays a dividend of $30,000. For the year...
On 1 July, 2018 Bundoora Ltd acquires 25 per cent of the issued capital of Preston...
On 1 July, 2018 Bundoora Ltd acquires 25 per cent of the issued capital of Preston Ltd for a cash consideration of $150,000. At the date of acquisition, the share capital and retained earnings of Preston Ltd are as follows: Share capital $120,000 and Retained earnings $480,000 (Total Shareholders' equity $600,000). Additional information: § For the year ending 30 June, 2019 Preston Ltd records an after tax profit of $50,000 from which it pays a dividend of $30,000. § For...
On 1 July 2014 Padma Ltd acquires 25 per cent of the issued capital of Jamuna...
On 1 July 2014 Padma Ltd acquires 25 per cent of the issued capital of Jamuna Ltd for a cash consideration of $360 000. At the date of acquisition, the shareholders’ equity of Jamuna Ltd is: Share capital $450 000 Retained earnings $300 000 Total shareholders’ equity 750 000 Additional information • On the date of acquisition, buildings have a carrying amount in the accounts of Jamuna Ltd of $240 000 and a market value of $300 000. The buildings...
1. On 1 July 2014 Padma Ltd acquires 25 per cent of the issued capital of...
1. On 1 July 2014 Padma Ltd acquires 25 per cent of the issued capital of Jamuna Ltd for a cash consideration of $360 000. At the date of acquisition, the shareholders’ equity of Jamuna Ltd is: Share capital $450 000 Retained earnings $300 000 Total shareholders’ equity 750 000 Additional information On the date of acquisition, buildings have a carrying amount in the accounts of Jamuna Ltd of $240 000 and a market value of $300 000. The buildings...
On 1 July 2014 Stokes Ltd acquires 25 per cent of the issued capital of Cotter...
On 1 July 2014 Stokes Ltd acquires 25 per cent of the issued capital of Cotter Ltd for a cash consideration of $120 000. At the date of acquisition, the shareholders’ equity of Cotter Ltd is: Share capital $150 000 Retained earnings $100 000 Total shareholders’ equity $250 000 Additional information: ? On the date of acquisition, buildings have a carrying amount in the accounts of Cotter Ltd of $80 000 and a market value of $100 000. The buildings...
If a 20 per cent reduction in the price of Hello magazine leads to a 6...
If a 20 per cent reduction in the price of Hello magazine leads to a 6 per cent increase in its sales, the price elasticity of demand is what?
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT