Solution-Calculate acquisition analysis using partial

Calculate acquisition analysis using partial goodwill method

Reference no: EM132549967

Question - XYZ Ltd acquired a 70% interest in ABC Ltd on 1 July 2020 for $500,000. On the same date, the balance of shareholders' equity of S Ltd comprised:

Share capital $50,000

General reserve 10,000

Retained earnings 15,000

75,000

All assets are recorded at their fair values except for an item of buildings, which had a fair value of $500,000 and a carrying amount of $350,000 (original cost $400,000). The building has remaining life of 10 years.

The fair value of the Non-Controlling Interest (NCI) in ABC Ltd on 1 July 2020 was $50,000.

Required -

1. Calculate acquisition analysis using partial goodwill method.

2. Prepare the necessary journal entries under partial goodwill method.

Reference no: EM132549967

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Calculate acquisition analysis using partial goodwill method

Reference no: EM132549967

Reference no: EM132549967

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