Osborne Question Help Please

Clarekaye

Issued share capital of Fladbury Ltd 800,000 ordinary shares of .25p each
The reserves of the company currently total £140,000
Cropthorne owns 500,000 ordinary shares in Fladbury

What is the value of the non- controlling interest at March 20x1?

£52500
£127500
£212500
£352500

Any help as I keep getting £12500! thanks :001_smile:

stevef

I make it £212,500
800,000 shares @ .25 = £200,000 +£140,000 reserves = £340,000

Controlling interest is 500,000 of 800,000 shares

so value of non controlling interest
500,000/800,000*£340,000 = £212,500

anniebabe

125000 is only Cropthornes investment (500 x .25)
you need to work out the percentage that Cropthorne owns of Fladbury Ltd and the percentage that they do not own is the non-controlling interest.

Clarekaye

The answer is £127,500...but how?

stevef

Sorry the last line of my first calculation is wrong

The total value is £340,000, but non controlling interest is

300,000/800,000*£340,000 = £127,500.