FNST - Consolidated SOCI Query - BPP

anniebabe

Hi Guys
Just working through FNST - BPP Question Bank, Practice assessment 1
Page 244 - Claw acquired 90% of Deer. Consolidated SOCI.
Can anyone let me know how they worked out the dividend received?
the question just says that Other income £1800 of Claw included a dividend received for Deer Ltd.
What am i missing? the answer says it should be £261 - brains gone numb.

Thanks

Nps

I don't have the book so can't see the question and figures, but just a thought........

Is there perhaps an entry in Deer's individual statements that mentions a dividend paid out. You can then use that figure in conjunction with the other figures to get the £261. Or perhaps a figure in Claw's which mentions dividends received.

As I say, I don't have the question so I may be barking up the wrong tree!

anniebabe

Hi Nps
It says :-
Deer paid a dividend of £1710,000 on 17/3/x1

Nps

Sorry, don't know then without reading the whole question. I actually have the book at home but am away visiting family at the mo so don't have access to it. Sorry! If no one else has replied by Monday, when I get back I'll try to find the question.

anniebabe

Claw plc acquired 90% of the issued share capital and voting rights of Deer Lts on 1 April xo
Extracts from their statement of comprehensive income for the year ended 31/3/x1 are shown below:
Claw Deer
Revenue 40800 18600
Cost of Sales (24200) (7300)
Gross Profit 16600 11300
Other income 1800 -
Dist and Admin (2500) (1600)
Profit <Tax 15900 9700

During the year Deer Lts sold goods which cost £100,000 to Claw for £480000. Half remain in stock at year end.
Other income of Claw included a dividend received from Deer Ltd.
Deer Ltd had paid a dividend of £1710000 on 17/3/x1

Draft the consolidated soci for Claw and its subsidiary.

Nps

90% of the £1710 paid out by Deer has been paid to Claw (£1539). This will be cancelled out in the consolidated statements as it is an intra-group transfer, hence the amount remaining of the £1800 of Claws other income is £261.

anniebabe

ok , will look at it again.
thanks

avalon1163

Thanks a lot to Nps1976 - that makes perfectly sense.

Hi Anniebabe - thanks for asking the question :-)