BPP 2016 Question

Sophie967

I am studying FSLC through distance learning and I'm struggling quite a bit with group accounts. I have attached the question and answer below but I don't understand how they have worked out good will? It's seems to be different to the way I have learnt it.

Also, why have they done NCI at acquisition? The only way I have done it is at year end?

Any help would be much appreciated!!

hal978

Although I studied AQ2013, I remember studying this.

There are 12m Devon shares. 9m were purchased (75%). The NCI percentage is therefore 25%.

Devon Ltd's Equity at the time of acquisition was the share capital + share premium + £12.052m (point 3) + £3m revaluation (point 4) giving £31.052m.

The NCI at acquisition is simply the NCI percentage x net assets at acquisition, which = 25% x £31.052m = £7.763m.