Advanced Financial Accounting Theory

Running head: ADVANCED FINANCIAL ACCOUNTING
Advanced Financial Accounting
Name of the Student:
Name of the University:
Author’s Note:

ADVANCED FINANCIAL ACCOUNTING1
Table of Contents
Answer to question 1:......................................................................................................................2
Answer to question 2:......................................................................................................................4
Answer to question 3:......................................................................................................................5
Bibliography:...................................................................................................................................7

ADVANCED FINANCIAL ACCOUNTING2
Answer to question 1:
Identifiable net assets method:
Workings:
Ordinary shares $ 4,500.00
Retained earnings $ 5,950.00
Fair value adjustments:
Plant and equipment (Net) (7000-8300) $ (1,300.00)
Inventory (5500-5300) $ 200.00
Value of Identifiable Net Assets $ 9,350.00
Net assets attributable to the P Company (9350*90%) $ 8,415.00
Less: Purchase consideration transferred $ 8,887.50
Value of goodwill $ 472.50
NCI Share in equity (9350*10%) $ 935.00
Consolidated statement of financial position
Plant and equipment $ 16,600.00
Goodwill $ 472.50
Total non-current assets $ 17,072.50
Cash $ 7,050.00
Accounts receivables $ 9,450.00
Inventory $ 12,160.00
Total current assets $ 28,660.00
Total assets $ 45,732.50
Accounts payable $ 3,600.00
Other current liabilities $ 5,787.50
Total current liabilities $ 9,387.50
Long term liabilities $ 8,000.00
Total noncurrent liabilities $ 8,000.00
Total liabilities $ 17,387.50
Net Assets $ 28,345.00
Ordinary shares $ 12,000.00
Retained earnings $ 15,410.00
Non-Controlling Interest $ 935.00
Total Equity $ 28,345.00