Reference no: EM132982396
QUESTIONS - On 1 July 2018, Parent Ltd acquired 90% of the ordinary voting shares of Child Ltd which in turn acquired 80% of the ordinary voting shares of Grandchild Ltd.
The fair value of the net assets of Grandchild Ltd at the date of acquisition are represented by total shareholders' equity as follows:
$
Share capital 200,000
Retained profits 100,000
Total shareholders' equity 300,000
The net profits of and dividends paid by Grandchild Ltd for the two years ending 30 June 2019 and 30 June 2020 are as follows:
The After Tax Profit for the year ended on 30 June 2019 150,000
Dividends paid for the year ended on 30 June 2019 (50,000)
The After Tax Profit for the year ended on 30 June 2020 300,000
There are no other changes in the equity for Grandchild Ltd.
REQUIRED - Prepare a table that shows the ownership interest percentages in the two subsidiaries distinguishing between direct and indirect interests.
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