Illustration of pre-aquisition, Financial Accounting

Illustration of Pre-Aquisition

H Ltd.. Acquired 80% of S Ltd. during the year ended 31/12/04.  S Ltd. paid an interim dividend of  40,000 on 30th September and as at 31/12/04 has proposed a dividend of 60,000.

Compute the pre-acquisition dividend to cost of control assuming that H Ltd. acquired S Ltd. on the following dates;

i) 1st July, 2004,  ii)  1st October, 2004 – H did not receive share of interim dividend.









Total dividends

: Paid















Post acquisition dividends

(6/12 x 100,000)



Pre-acquisition dividend to cost of control




Holding company share of dividend: 


Interim receive (80/100 x 40,000)





Interim proposed (80/100x 60,000)







Less: Holding company share of post acquisition of dividends



(80/100 x 50,000)












Posted Date: 12/12/2012 4:18:18 AM | Location : United States

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