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Chapter 20

1.3 Indirect holding adjustment

Accounting for a sub-subsidiary requires an indirect holding adjustment.

This is calculated as:

NCI % in Company B × Consideration paid by Company B

The entry to record this is:

Dr NCI (W4) X

Cr Goodwill (W3) X

Illustrations and further practice

Now try TYU question 2 from Chapter 20.

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