I n t e r a c t I v e t e X t foundations in Accountancy/ acca financial accounting (ffa/FA) bpp learning Media is an acca approved Content Provider

 

 1 

Fill in the blanks.

  

 

Goodwill is the excess of ……………. …….. plus fair value of ….-………….. ………….. over fair value 

of net assets acquired. It should be included in the consolidated statement of financial position as an 

…………..  ……...   

2 

Pretty Co owns 80% of Ugly Co. Ugly Co sells goods to Pretty Co at cost plus 50%. The total invoiced 

sales to Pretty Co by Ugly Co in the year ended 31 December 20X9 were $120,000 and, of these sales, 

50% were held in inventory by Pretty Co at 31 December 20X9. What is the provision for unrealised 

profit? 

3  

Major Co, which makes up its accounts to 31 December, has an 80% owned subsidiary Minor Co.  

Minor Co sells goods to Major Co at a margin of 30%. At 31 December 20X8, Major had $12,000 of 

such goods in its inventory. What is the provision for unrealised profit? 

4 

Complete the equation for calculating the NCI figure in the statement of financial position below.   

Non-controlling interest 

 

$ 

Fair value of NCI at acquisition 

 

X 

Plus …………………………………………………………….. 

 

X 

NCI at reporting date 

 

X 

5 

The summarised statements of financial position of Falcon and Kestrel at 31 December 20X8 were as 

follows. 

 

  

Falcon 

  

Kestrel 

 

  

$m 

  

$m 

Net assets 

  

68 

  

25 

Share capital 

  10 

  10 

Reserves 

  

58 

  

15 

 

  

68 

  

25 

On 1 January 20X8 Falcon purchased 80% of the equity share capital of Kestrel for $28m. The fair 

value of the net assets of Kestrel was $30m at that date. The fair value of the NCI at the acquisition date 

was $5m.  

 

Calculate the goodwill arising on consolidation.