Illustration: computation of retained profits acquisition, Financial Accounting

Illustration: Computation of retained profits acquisition

Assume that H Ltd.. Acquired 80% of S Ltd.. On 1st April, 2003. The retained profits of the subsidiary company b/d amounted to £ 120,000 and the c/d amounted to £150,000.

REQ. Compute the retained profits on date of acquisition and the amount to be transferred to the cost of control if the financial year end is 31/12/03

Retained profits for the year:   Bal c/d – Bal b/d
                                          =150,000 – 120,000
                                          =30,000

Pre-acquisition profits: 1st Jan 03 – 31st March 03   = ¼ X30,000 = 7500

Retained profits on acquisition   =  bal b/d  + pre-acquisition
                                                   =  120,000 + 7500
                                                   =   £127,000

  To cost of control
                 = 80% x 127,000
                 = £102,000

Posted Date: 12/12/2012 4:15:15 AM | Location : United States







Related Discussions:- Illustration: computation of retained profits acquisition, Assignment Help, Ask Question on Illustration: computation of retained profits acquisition, Get Answer, Expert's Help, Illustration: computation of retained profits acquisition Discussions

Write discussion on Illustration: computation of retained profits acquisition
Your posts are moderated
Related Questions
#question.DISCUSS THE APPLICABILITY OF AN OPERATING CYCLE IN POULTRY BUSINESS.

SED Analysis SDE i.e. Scarce, Difficult and Easy analysis estimates the significance of inventory items on the basis of their availability. According to SDE analysis the invent

TERMINATION OF OFFICE OF TRUSTEE The trustee may vacate office in the following ways: 1. Resignation : He may resign at a meeting of creditors and with their consent. 2.

Vincent Ltd operates solely in Western Australia and the chief operating decision maker has identified five operating segments: Mining, Insurance, Retailing, Manufacturing and Tran

Answer both parts in this task. Part (i) is worth a maximum of 10 Marks, while part (ii) is worth a maximum of 5 Marks. (i) Minnie owes Micky Mouse $500 and hands him a cheque p


like Amazon.com face with respect to safeguarding its assets? What types of controls do you think it already has in place to minimize these risks?

1. You can buy any quantity of cooking oil at $5 per litre and any quantity of flour at $2 per kilo. You have allocated $20 to spend on cooking oil and flour.    (a) If you choo

Common stocks A, B, C, and D had the following quarterly returns. A B C D 0.07 0.05 0.07 0.12

CarloffCremes (CC) planned to sell 40,000 Queen size at $20 each and 20,000 King size at $15 each. Actual sales of the former were 45,000 and 25,000 of the latter, at $19 and $16 r