What was the goodwill arising on acquisition of xy

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Reference no: EM132969643

CD purchased 70% of the ordinary share capital of XY for £350,000 two years ago, when XY's retained earnings were £35,000.

XY's reserves at the year end are:

A. Ordinary share capital £1 £200,000

B. Share Premium £110,000

C. Retained earnings £85,000

Problem 1: The fair value of the non-controlling interest at acquisition was ££31,000. XY has not issued any shares since it was acquired by CD. What was the goodwill arising on acquisition of XY?

Option A £64,000

Option B £36,000

Option C £139,500

Option D £108,500

Reference no: EM132969643

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