Question

5)

you will is uetermined by inference. Describe how this is achieved, and comment on 3. what is non-controlling interest, and where is it reported in the consolidated balance sheet und identifiable net assets and fair value enterprise methods? 6. What accounts on the consolidated balance sheet differ in value hetween fair value enterprise

Answer 1

Solution. 5. In case of company owning majority stake, and shareholder's owning below hundred percent of shares, company consolidates subsidiary's reporting into its own as a single entity and shares assets and liabilities.

In such cases where minority shareholder's owning above fifty percent but less than hundred percent of outstanding shares, non-controlling interest are recorded into stockholder's equity account for their share of acquisition under the following ways:

a)Recording of non-controlling interest is done by distributing proportionately subsidiary's net assets value(total assets less intangible assets and liabilities) and multiplied to percentage of subsidiary owned, transferred to consolidated balance sheet under equity head.

b)Recording of Enterprise Value= market value of common stock + market value of preferred equity + debt value + minority interest - excess of cash and other investments is done to arrive to enterprise value.