Ideal minority interest, Financial Accounting

Assignment Help:

IDEAL MINORITY INTEREST

The minority interest ideally is entitled to the profit after tax in minority interest. However due to consolidation, the profits of the subsidiary company should be adjusted first before getting their share. Care should also be taken especially if the subsidiary company has issued preference share capital and the minority interst owns part of this.

The computation will therefore be carried out as follows:

 

£

£

Subsidiary company’s profit after tax

 

X

Add:

 

 

Annual excess depreciation charged by subsidiary co

X

 

Unrealised profit on opening inventory if subsidiary co. had made the sale

x

X

 

 

x

Less

 

 

Annual additional depreciation on Fair value adjustment

X

 

Unrealised profit on closing inventory if subsidiary co. made the sale

X

 

Unraelsied profit on PPE if subsiadiary company made the sale

X

(x)

Adjusted profit after tax in subsidiary

 

X

Less Preference dividend

 

(x)

Profit attributable to ordinary share holders in subsidiary company

 

X

Total due to Minority interest:

 

 

   - MI’s share of preference dividend

 

X

   - MI’ s share of profit attributable to ordinary shareholders

 

X

 

 

X


Related Discussions:- Ideal minority interest

Format for balance sheet, FORMAT FOR BALANCE SHEET The non current asse...

FORMAT FOR BALANCE SHEET The non current assets, current assets and current liabilities sections remain identical to those of a sole proprietorship.  However, the “capital sect

Calculate and interpret the two revenue variances, Consider the following 2...

Consider the following 2008 data for Newark General Hospitals (in millions of dollars Simple Budget_______Flexible Budget_ Actual Budget__ Revenue______$4.7$____4.8_____$4.5_

Compute the npv and irr, Question: Consider a project that involves the...

Question: Consider a project that involves the purchase of a $100,000 machine.  The machine will last for three years.  It is expected to produce 20,000 units per year.  The sa

State the relationship between return and risk, State the relationship betw...

State the relationship between return and risk This relationship between return and risk has significant implications for setting financial objectives for a business. Owners wil

Presentation method-foreing branches, Presentation method (formerly closin...

Presentation method (formerly closing rate or net investment method) Under this method, the branch operates with a lot of degree of autonomy from the head office. This position i

What kinds of risks does a firm, like Amazon.com face with respect to safeg...

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?

Determine the cost of capital and risk free rate, Instructions: The ...

Instructions: The case should be done in your assigned groups. Hand in a brief write-up not exceeding two pages explaining what was done.   In April 198

Goods at branch marked down, GOODS AT BRANCH MARKED DOWN, OR MARKED UP BY A...

GOODS AT BRANCH MARKED DOWN, OR MARKED UP BY AN ADDITIONAL AMOUNT If goods at the branch are not selling well, branch could be authorized by the Head office to mark-down the good

Prepare financial report for large accounting firm, Question: You are a...

Question: You are a member of a large accounting firm which is responsible for preparing financial reports, including statements and notes to the accounts; and for advising sta

Financial accounting, The following items are found in the trial balance of...

The following items are found in the trial balance of M/s Sharada Enterprise on 31st December, 2000. 10 marks Summer 2013 Sundry Debtors Rs.160000 Bad Debts written off Rs 9000 Dis

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd