At the date of acquisition, how is the amount of non-controlling interest measured under the entity method and the parent-company extension method, respectively?
Answer to relevant QuestionsHow do unrealized profits on upstream sales affect the non-controlling interest’s share of a subsidiary’s earnings?Simpson Ltd. is a private Ontario corporation controlled by Ted Simpson. The company owns a series of chocolate chip cookie stores throughout Ontario, and also has a wholly owned Quebec subsidiary that operates stores in ...On January 1, 20X5, Big Ltd. purchased 80% of the shares of Small Ltd. for $ 1,400,000 and, on the same day, Small Ltd. purchased 60% of the shares of Smaller Ltd. for $ 930,000. Any excess of the purchase price was ...How does the adjustment differ when there is a sale of an intangible asset; e. g., patent with limited life instead of a capital asset from the subsidiary to the parent? Under equity reporting, why are unrealized profits from downstream sales deducted from the investor’s equity in the earnings of the investee instead of from the parent’s own earnings?
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