H plc is a holding company with a 70% interest in its subsidiary S plc.The following is an extract from the Statements of Financial Position of the two companies asat the end of their most recent financial year:H plcS plc£m£mOrdinary shares of £111651Retained earnings4243H plc acquired its interest in S plc for £77m when S plc's retained earnings were £25m and thefair value of the non-controlling interest in S plc was £33m.The goodwill arising on acquisition of S plc is to be impaired by £8m.Calculate the amount for retained earnings that would be reported in H plc's consolidatedbalance sheet at the end of its most recent financial year. Enter your answer as £m correct to1 decimal place.

Retained Earnings- Retained earnings are the accumulated portion of a company's profits in a fiscal…

H plc is a holding company with a 70% interest in its subsidiary S plc. The following is an extract from the Statements of Financial Position of the two companies as at the end of their most recent financial year: H plc S plc £m £m Ordinary shares of £1 116 51 Retained earnings 42 43

H plc is a holding company with a 70% interest in its subsidiary S plc. The following is an extract from the Statements of Financial Position of the two companies as at the end of their most recent financial year: H plc S plc £m £m Ordinary shares of £1 116 51 Retained earnings 42 43

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Question

H plc is a holding company with a 70% interest in its subsidiary S plc.
The following is an extract from the Statements of Financial Position of the two companies as
at the end of their most recent financial year:
H plc
S plc
£m
£m
Ordinary shares of £1
116
51
Retained earnings
42
43
H plc acquired its interest in S plc for £77m when S plc's retained earnings were £25m and the
fair value of the non-controlling interest in S plc was £33m.
The goodwill arising on acquisition of S plc is to be impaired by £8m.
Calculate the amount for retained earnings that would be reported in H plc's consolidated
balance sheet at the end of its most recent financial year. Enter your answer as £m correct to
1 decimal place.

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