kingstongal

page 155 book2.

it says NCI under full goodwill is the percentage of minority interest x fair value. in your example, shouldnt that be 20%x 100. NCI= 20????


passme Wrote:
-------------------------------------------------------
NCI is found under Aquisition method.
in most Aquisition, Parent company only purchases a certain % of the Sister company.
lets say A buys B for 80% of B's fair value of net asset.

the 20% is NCI and has to be added to A's Equity in consolidated balance sheet.

NCI differers under full and partial good will methods.
lets say: A buys B for $100, and B's net asset is 50.
full goodwill method: 100/0.80=125, 25 is NCI
partial goodwill method: 50X(1-0.80)=10 is NCI