question archive Abell Berhad paid RM1,050,000 to acquire 70% of Kau Sing Berhad's outstanding common stock on July 1, 2018
Abell Berhad paid RM1,050,000 to acquire 70% of Kau Sing Berhad's outstanding common stock on July 1, 2018
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Abell Berhad paid RM1,050,000 to acquire 70% of Kau Sing Berhad's outstanding common stock on July 1, 2018. Kau Sing's balance sheet on the acquisition date reported net assets totaling RM1,200,000. Kau Sing's land had a fair value which was RM175,000 greater than book value, while the inventory's fair value exceeded its book value by RM67,500. Immediately after the acquisition of the Kau Sing stock, Abell reported net assets of RM5,785,000. Required: (b) Determine the consolidated net assets total as of July 1, 2018. Determine the amount of noncontrolling interest to be reported on the July 1, 2018 balance sheet. How is the noncontrolling interest reported within the consolidated balance sheet? Assume that the acquisition method of accounting is applicable.
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