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Accounting - consolidated financial statements This is...

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1.what does the term non-controlling interest mean? Solution: Non-controlling interest in simple terms can be defined to be the stake or holding of those investors who does not have a significant controlling interest in the company. Whwn one company acquires more than 50% shares in a company thereby acquiring significant control over the business then the interest of the remaining people is regarded as non-controlling interest. 4. Where should the non-controlling interests claims be reported in a consolidated set of financial statements? Solution: The non-controlling interest should be reported below the stockholders equity in the
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Unformatted text preview: consolidated financial statements. This is because the consolidation is done on a total basis and those interest which is not owned by the holding company should be reported as a liability and thus shown below shareholders equity. 5. How is the non-controlling interest in a subsidiary company calculated as of the end of the current year? Solution: The non-controlling interest in the subsidiary is calculated as under – Share in share capital XX Add: Share in profits XX Non-controlling interest XX...
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