Accounting-.1 - Multiply: - Noncontrolling Interest in...

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Answer:- A Consolidated Income Statement is prepared is the same that all the expenses and revenues are combined of the holding company and subsidiary company are added up together to arrive at one figure. Separate Accounting books are maintained for each company but at the time of preparing the income statement these are added together. The only difference is that intercompany transactions are excluded. The important point in calculation is the calculation of Controlling and non controlling interest. Non Controlling Interest in Income = Reported Income of Subsidiary Company Add/Less:-Adjustments =Net Income of Subsidiary company
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Unformatted text preview: Multiply: - Noncontrolling Interest in Percentage =Noncontrolling Interest In income Intercompany Transactions of revenue and expenses are excluded because they are just transfer of amounts within single ownership and at the time of consolidation they dont have any impact on assets. Thus intercompany Purchase and sales and interest income and expense is excluded. Consolidation is done as follows:-Revenue and Expenses of Holding Company Add/Less:-Revenue and expenses of Subsidiary Company Less:-Noncontrolling Interest in Income (as shown above) =Consolidated Net Income...
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