Kevin Plc acquired 70% of Carl Ltd on 1 April 2021 for £3,250,000 when Carl's retained earnings were £1,500,000. The group's policy is to measure NCI at fair value at acquisition. An impairment review was performed on 31 March 2022, and this indicated that goodwill had impaired by £850,000. Which of the following statements is/are correct in respect of the consolidated retained earnings at 31 March 2022? (1) 100% of Kevin's post acquisition retained earnings will be included (2) 100% of Carl's post acquisition retained earnings will be included (3) Goodwill impairment of £850,000 will be deducted O a. (1) only O b. (2) only O c. (1) and (2) only O d. (1) and (3) only O e. (2) and (3) only O f. (1), (2) and (3)
Kevin Plc acquired 70% of Carl Ltd on 1 April 2021 for £3,250,000 when Carl's retained earnings were £1,500,000. The group's policy is to measure NCI at fair value at acquisition. An impairment review was performed on 31 March 2022, and this indicated that goodwill had impaired by £850,000. Which of the following statements is/are correct in respect of the consolidated retained earnings at 31 March 2022? (1) 100% of Kevin's post acquisition retained earnings will be included (2) 100% of Carl's post acquisition retained earnings will be included (3) Goodwill impairment of £850,000 will be deducted O a. (1) only O b. (2) only O c. (1) and (2) only O d. (1) and (3) only O e. (2) and (3) only O f. (1), (2) and (3)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Q16
Transcribed Image Text:Kevin Plc acquired 70% of Carl Ltd on 1 April 2021 for £3,250,000 when Carl's retained earnings were
£1,500,000. The group's policy is to measure NCI at fair value at acquisition.
An impairment review was performed on 31 March 2022, and this indicated that goodwill had impaired
by £850,000.
Which of the following statements is/are correct in respect of the consolidated retained earnings
at 31 March 2022?
(1) 100% of Kevin's post acquisition retained earnings will be included
(2) 100% of Carl's post acquisition retained earnings will be included
(3) Goodwill impairment of £850,000 will be deducted
O a. (1) only
O b. (2) only
O c. (1) and (2) only
O d.
(1) and (3) only
O e.
(2) and (3) only
O f. (1), (2) and (3)
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