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Chapter 20

Example 1 cont.

(ii) Consolidated statement of profit or loss

$000 $000
Sale proceeds 8,000
Net assets at disposal 7,000
Goodwill at disposal (W1) 1,200
NCI at disposal (W2) (1,400)
——— (6,800)
———
Profit on disposal 1,200
Tax (per part (i) DO NOT RECALCULATE) (600)
———
Profit after tax 600
———

(W1) Goodwill
$000
Cost of investment 6,000
Fair value of NCI 1,200
Net assets at acquisition (5,000)
———
Gooodwill at acquisition 2,200
Impairment per question (1,000)
———
Goodwill at disposal 1,200
———

(W2) Non-controlling interest
$000
Value at acquisition (W1) 1,200
Impairment (1,000 × 20%) (200)
Post-acquisition profit
(7,000 – 5,000) × 20% 400
———
1,400
———

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