Business Combination

Business Combination Formula s

1. )

Noncontrolling interest

Priority 1 = 1 = Fair value of NCI given to the problem but it should not be lower than the NCI - measured at Non-controlling interest's proportionate share of Subsidairy's identifiable net assets @ Fair alue! If fair value of NCI given to the problem is lower than NCI measured at proportionate share of Subsidiary's identifiable net assets use the latter! Compuation of NCI measured in proportionate share of Subsidiary's identifiable net assets! Subsidiary net assets at Fair alue #ultiply by$ Noncontrolling interest Fair value of NCI proportionate share in Subsidiary identifiable net assets

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Priority ! = ! = If Fair value of NCI is not given or un&nown  c(uistion cost )ivided by$ Controlling interest *otal fair value of business #ultiply by$ Noncontrolling interest Fair value of Noncontrolling interest

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Note$ +ut again the computed Fair value of Noncontrolling interest should not be lower than than the fair value of NCI in proportionate share in Subsidiary's identifiable net assets. Not e$

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,e apply whichever is is higher rule$ art of the new provision. provision. NCI should not have an amount that is lower than the fair value of NCI measured in proportionate share in Subsidiary's Subsidiary's identifiable identifiable net assets. We use whichever is higher.

"esult of ac#uisition

 c(uisition cost /Consideration paid0 paid0 F# of NCI F# of old investment in same company ac(uired / less than 12%0. included  Contingent liabiilty

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Print document In order to print this document from Scribd, you'll *otal first need download it. 3ess$ F# of Subsidiary Net to ssets /422%0 $ood%ill&$ain from ac#uisition '. )

Consolidated total (ssets

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Consolidated additional paid in capital arent additional paid in capital  dd$ New issued share to ac(uire subsidiay - e"cess of par  *otal 3ess$ Stoc& issue cost. if any Consolidated additional paid in capital

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Consolidated common stoc+ arent common stoc& before ac((uisition  dd$ New issued shares to ac(uire subsidairy @ ar value Consolidated Common Stoc+

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Consolidated retained earnings

arent retained earnings before ac(uisition  dd$ 5ain from ac(uistion. if any *otal 3ess$ 6"penses /)irect cost. indirect cost0 Consolidated retained earnings *. )

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arent total assets /boo& value0 Subsidairy total assets /fair value0 exclusive of goodwill, if any  5oodwill - result from acquisition ayment - taken from the assets of the acquirer  Consolidated total assets . )

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Consolidated stoc+holders e#uity

Consolidated common stoc& Consolidated additional paid in capital Consolidated retained earnings Noncontrolling interest Consolidated stoc+holders e#uity

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