Calculate the goodwill and the non-controlling interest

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Reference no: EM132996744

Problem - Answer all parts of this question

(a) Claire is an accountant who runs her own accountancy practice and employs ?ve auditors. She has become friends with the ?nance director of one of her clients. In addition, 60% of the practice fees relate to work for another of her clients. Discuss the ethical dilemmas that Claire may face. Your answer to this part of the question should not be more than 150 words.

(b) What is Current Purchasing Power (CPP) accounting and why does the monetary capital adjustment arise under this method? Your answer to this part of the question should not be more than 150 words.

(c) What are construction contracts and how are the concepts of relevance and reliability applied to accounting for construction contracts. Your answer to this part of the question should not be more than 150 words.

(d) H acquires 80% of the ordinary shares in S in exchange for 1,000 shares in H, each worth £10.00. The net assets of S at acquisition are £4,000. The fair value of the Non-Controlling Interest (NCI) is £2,600. Calculate the goodwill and the Non-Controlling Interest (NCI) using methods 1 and 2 for dealing with Non-Controlling Interest.

Reference no: EM132996744

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