times

Step - 01 Calculation of Ratio

Step - 02 Calculation of Pre-Ac

1,20,000 X 3/12

Step - 03 Calculation of Post A

Step - 04 Calculatio of Non Con

Step - 05 Calculation of Cost of

Calculation of Ratio 7:03

Calculation of Pre-Acquisition Profit

1,20,000 X 3/12
1.4.2021
31.3.2022
Calculation of Post Acquisition

Calculatio of Non Controlling Interest

Calculation of Cost of Control/ Goowill

392
 Profit or Loss Account For the Year ended 31.3.2023
Particulars Amount Amount
Revenue From Operation 878,240
Add: Other Incomes Nil
Total Revenue from Operation 878,240
Less: Expenses
Cost of Material Consumed 97,400
Purchases Nil
Changes in Inventory Nil
Employee Benefit Expenses Nil
Finance Cost 9,400
Depreciation Nil
Other Expenses
Selling Exp 104,600
Admin Expenses 49,000 260,400
Profit Before tax 617,840
Less: Tax 52,000
Profit After Tax 565,840

Profit or Loss Account For the Year ended 31.3.2023

Particulars Amount Amount
Revenue From Operation 650,000
Add: Other Incomes
Share Transfer Fees 5,000
Commission Received 7,500 12,500
Total Revenue from Operation 662,500
Less: Expenses
Cost of Material Consumed 398,000
Purchases Nil
Changes in Inventory Nil
Employee Benefit Expenses Nil
Finance Cost - Int on Debt 32,400
Depreciation 25,000
Other Expenses
Travelling Exp 15,000
Del. Van Expenses 5,000
Bad Debts 6,000
Discount Allowed 7,000
Insurance 5,000
493,400
Profit Before tax 169,100
Less: Tax 0
Profit After Tax 169,100
ILLUSTRATION - 03

Profit or Loss Account For the Year ended 31.3.2023

Particulars Amount Amount
Revenue From Operation 39,000
Add: Other Incomes 6,000
Total Revenue from Operation 45,000
Less: Expenses
Cost of Material Consumed 24,500
Purchases 0
Changes in Inventory 2,500
Changes in WIP 1,500
Employee Benefit Expenses 2,000
Finance Cost 1,000
Depreciation & Amortization 3,000
Other Expenses 500 35,000

Profit Before tax 10,000

Less: Tax 1,200
Profit After Tax 8,800
A) Owners of the Parent 4,800
B) Non - Controlling Interest 4,000
Total 8,800

Illustration - 05
Profit or Loss Account For the Year ended 31.3.2023
Particulars Amount Amount
Revenue From Operation 1,600,000
Less: Excise Cuty 50,000 1,550,000
Add: Other Incomes
Commission Receive 300,000
Rent Received 40,000 340,000

Total Revenue from Operation 1,890,000

Less: Expenses
Cost of Material Consumed
Purchases ( 7,00,000 - 40,000) 660,000
Changes in Inventory 80,000
Employee Benefit Expenses 250,000
Finance Cost 60,000
Depreciation & Amortization 40,000
Other Expenses
Carriage Inwards 1,00,000
Consumable ( Stationary Exp) 60,000
Sundry Exp 10,0000 170,000 1,260,000
Profit Before tax 630,000
Less: Tax 75,000
Profit After Tax 555,000

Illustration - 07
Profit or Loss Account For the Year ended 31.3.2023
Particulars Amount Amount
Revenue From Operation ( Cash + Credit ) 653,500
Less: Sales return 17,000 636,500
Add: Other Incomes
Income tax refund 11,500
Discount Earned 4,900 16,400

Total Revenue from Operation 652,900

Less: Expenses
Cost of Material Consumed 292,000
Purchases 0
Changes in Inventory ( 1,90,500-2,03,000) -12,500
Employee Benefit Expenses
Salary to Employees 68,000
Bonus to Employees 32,000
Finance Cost - Int on Debt 16,250
Depreciation & Amortization
Depreciation on P & M 50,000
Goodwill Writtenoff 18,000
Other Expenses
Provision for Bad Debts 8,200
Delivery Expenses 7,200
 Printing & Stationary 22,600
Factory Expeses 82,000
General Expenses 8,250
592,000
Profit Before tax 60,900
Less: Provision for Tax 30,000
Profit After Tax 30,900

Illustration - 08
Profit or Loss Account For the Year ended 31.3.2023
Particulars Amount Amount
Revenue From Operation 1,095,000
Add: Other Incomes
Royalty Received 18,300
Total Revenue from Operation 1,113,300
Less: Expenses
Cost of Material Consumed 315,000
Purchases 0
Changes in Inventory
Finished Goods(2,90,000 - 1,84,000) 106,000
WIP ( 3,93,000 - 2,60,000) 133,000
Employee Benefit Expenses
Wages 74,000
Finance Cost
- Int on Bank Loan 60,000
Depreciation & Amortization
Depreciation on Plant 38,000
Patents Written off 25,200
Other Expenses
Bad Debts 16,570
 Admin Exp 37,400
Coal & Coke 87,500
Director Fees 57,000 949,670
Profit Before tax 163,630
Less: Provision for Tax 18,000
Profit After Tax 145,630

BALANCE SHEET AS ON 31.03.2024

Equities and Liabilities W.N Amount
1. Shareholders Fund
Equity share Capital 500,000
Reservers and Surplus
Capital Redemption Reserve 50,000
Profit or Loss Account 40,000
2. Share Application Money Pending 0
3. Non Current Liabilities
Non Current Liability 800,000

4. Current Liabilities
Current Liabilities 600,000

TOTAL 1,990,000

ASSETS
1. Non - Current Assets
A) Fixed Assets
- Tangible Assets
Plant Property Equipement 800,000
- In-Tangible Assets
Ingangible Assets 300,000
 - Other Non Current Assets 200,000

2. Current Assets
Current Investments 100,000
Inventories 90,000
Cash and Cash Equivalent 400,000
Trade Receivables 100,000

TOTAL 1,990,000

ILLUSTRATION - 02
BALANCE SHEET AS ON 31.03.2024
Equities and Liabilities W.N Amount
1. Shareholders Fund
Equity share Capital 300,000
Reservers and Surplus
Capital Redemption Reserve 100,000
Profit or Loss Account 200,000
2. Share Application Money Pending 0
3. Non Current Liabilities
Loan from Related Parties 200,000
Long term Bonds 200,000
4. Current Liabilities
Current Liabilities 40,000
Un-Paid Dividend 200,000
TOTAL 1,240,000

ASSETS
1. Non - Current Assets
A) Fixed Assets
- Tangible Assets
 Land 200,000
Buliding 300,000
- In-Tangible Assets
Brand OR Trade marks 200,000
- Other Non Current Invesment
Investment in MF 150,000
2. Current Assets
Shor-term Loans and Advances 100,000
Inventories 40,000
Cash and Cash Equivalent 200,000
Trade Receivables 50,000

TOTAL 1,240,000

ILLUSTRATION - 03
BALANCE SHEET AS ON 31.03.2024
Equities and Liabilities W.N Amount
1. Shareholders Fund
Equity share Capital 50,000
Reservers and Surplus 45,000
2. Share Application Money Pending
3. Non Current Liabilities
Secured Loans 75,000
Unsecured Loans 40,000
4. Current Liabilities
Trade Creditors 55,000
Accrued Expenses 1,000
Sundry Creditors 10,000
Provisions 86,000
TOTAL 362,000
 ASSETS
1. Non - Current Assets
A) Fixed Assets
- Tangible Assets
Gross block 230,000
Less: Depreciation 60,000 170,000
- In-Tangible Assets
- Other Non Current Invesment 20,000
- Other Non Current Assets - Capital 12,000
2. Current Assets
Incentives 60,000
Trade Debtors 75,000
Sundry Debtors 1,500
Prepaid Expenses 1,000
Cash or Bank Balance 1,000
Other Current Assets 1,500
Loans and Advances 20,000
TOTAL 362,000

ILLUSTRATION - 04
BALANCE SHEET AS ON 31.03.2024
Equities and Liabilities W.N Amount
1. Shareholders Fund
Equity share Capital 80,000
Reservers and Surplus 74,220
2. Share Application Money Pending
3. Non Current Liabilities
Long term Borrowings 20,000
4. Current Liabilities
Trade Payables 39,260
Short term provision 52,000

TOTAL 265,480

ASSETS
1. Non - Current Assets
A) Fixed Assets
- Tangible Assets 60,000
- In-Tangible Assets
- Other Non Current Invesment 4,000

2. Current Assets
Inventories 178,000
Trade Receivables 14,800
Cash or Bank Balance 6,280
Loans and Advances 2,400
TOTAL 265,480

ILLUSTRATION - 05
BALANCE SHEET AS ON 31.03.2024
Equities and Liabilities W.N Amount
1. Shareholders Fund
Equity share Capital & P.S.C 500,000
Reservers and Surplus 50,000
2. Share Application Money Pending
3. Non Current Liabilities 400,000
Staff PF 100,000
 Deposit from Public 100,000
4. Current Liabilities 100,000
TOTAL 1,250,000

ASSETS
1. Non - Current Assets
A) Fixed Assets
- Tangible Assets
Land & Buildings 400,000
Furniture 100,000
Office Equipment 50,000
- In-Tangible Assets
Goodwill 100,000
- Other Non Current Invesment 50,000
- Other Non current Assets 100,000
2. Current Assets
Inventories 200,000
Trade Receivables 100,000
Cash or Bank Balance 150,000

TOTAL 1,250,000
Computation of Other Comprehensive Income statement for the year ended 31.3.2023
Particulars Amount Amount
Net profit 420,000
Items which will not be reclassified to P/L
Gain on Property Revaluation 84,000
Loss on Investment in Equity -30,000
Available for Sale of Financial Asset 30,000
Re-Measurement Losses on Defined Pension Plan -54,000
Share of Gain on Property Revaluation 60,000
Income tax related to items that will not be reclassified 90,000 180,000
Total A 180,000
The items which will be reclassified to P/L
Exchange difference on translating foreign operation 72,000
Cahs Flow Edges -18,000
Income tax related to items that may be reclassified -12,000 42,000
Total B 42,000
Other Comprehensive Income ( A + B + 4,20,000) 642,000
Total Other Comprehensive income Attributable to :
1) Owners of the Parent 570,000
2) Non Controlling Interest 72,000
642,000

Computation of Other Comprehensive Income statement for the year ended 31.3.2023
Particulars Amount Amount
Net profit 100,000
Items which will not be reclassified to P/L
Loss on Property Revaluation -25,000
Profit on Investment in equity instrument 30,000
Available for Sale of Financial Asset 15,000
Gain on Defined Pension Plan 15,000 35,000
Total A 35,000
The items which will be reclassified to P/L
Exchange difference on translating foreign operation 24,000
Cahs Flow Hedges -5,000
Income tax related to items that may be reclassified -5,000 14,000
Total B 14,000
Other Comprehensive Income ( A + B + 1,00,000) 149,000
Total Other Comprehensive income Attributable to :
1) Owners of the Parent 100,000
2) Non Controlling Interest 49,000
Total Other Comprehensive income 149,000

Computation of Other Comprehensive Income statement for the year ended 31.3.2023
Particulars Amount Amount
Net profit 50,000
Items which will not be reclassified to P/L
Gain on Property Revaluation 12,000
Loss on Investment in Equity -22,000
Income tax related to items that will not be reclassified 5,000
Re-Measurement Losses on Defined Pension Plan -600
Share of Gain on Property Revaluation 1,000 -4,600
Total A -4,600
The items which will be reclassified to P/L
Exchange difference on translating foreign operation 3,000
Cahs Flow Hedges -600
Income tax related to items that may be reclassified -2,000 400
Total B 400
Other Comprehensive Income ( A + B + 50,000) 45,800
Total Other Comprehensive income Attributable to :
1) Owners of the Parent/ Controlling Interest 39,000
2) Non Controlling Interest 6,800
Total Other Comprehensive income 45,800
Date of Acquisition = 1/7/2021

Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in V Ltd 10,000
No of Shares held by A Ltd 7,000
No of Shares in Minorities 3,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves as on 1.4.2021
Profits as on 1.4.2021
Net Profit upto 1.7.2021 ( 1,20,000 X 3/12)
Add: Increase in the value of Assets
Less: Decrease in the value of Assets
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit

Distribution of Capital Profit

A Ltd = 2,10,000 X 7/10 = 1,47,000
Minorities = 2,10,000 X 3/10 = 63,000

Step - 03
Calculation of Post Acquisition Profit OR Revenue Profit

Particulars Amount
Reserves created after the date of Acquisition
Net Profits from 1.7.2021 to 31.3.2022 ( 1,20,000 X 9/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

A Ltd = 90,000 X 7/10 = 63,000
Minorities = 90,000 X 3/10 = 27,000

Step - 04
Calculation of Non Controlling Interest/ Minorities Interest
Particulars Amount
Face value of Shares helb by Minorities ( 3,000 X 100)
Add: Proportionate Share of Capital Profit ( Refer Step 2)
Add: Proportionate Share of Revenue Profit ( Refer Step 3)

Less: Proportionate Share of Capital Loss ( Refer Step 2)

Less: Proportionate Share of Revenue Loss ( Refer Step 3)
Non Controlling Interest

Step - 05
Calculation of Goodwill/ Cost of Control/ Capital Reserve
Particulars Amount
Purchase Price/ Investment
Add: Parent company Share of Capital Loss ( if Any)

Less: Face value of Shares held by Parent Company

Less: Parent company Share of Capital Profit
Goodwill/ Cost of Control/ Capital Reserve
Illustration - 02
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Kuchela Ltd 80,000
No of Shares held by Krishna Ltd ( 80,000 X 60%) 48,000
No of Shares in Minorities 32,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves up to 1.10.2020
Profits up to 1.10.2020
Net Profit upto 1.10.2020 ( 1,20,000 X 6/12)
Capital Profit

Distribution of Capital Profit

Krishna Ltd = 2,80,000 X 3/5= 1,68,000
Minorities = 2,80,000 X 2/5 = 1,12,000

Step - 03
Calculation of Post Acquisition Profit OR Revenue Profit

Particulars Amount
Reserves created after the date of Acquisition
Net Profits from 1.10.2020 to 31.3.2021 ( 1,20,000 X 6/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

A Ltd = 60,000 X 3/5 = 36,000
Minorities = 60,000 X 2/5 = 24,000
Step - 04
Calculation of Goodwill/ Cost of Control/ Capital Reserve
Particulars Amount
Purchase Price/ Investment
Add: Parent company Share of Capital Loss ( if Any)

Less: Face value of Shares held by Parent Company 4,800,000

Less: Parent company Share of Capital Profit 168,000
Capital Reserve

Illustration - 03
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Chandra Company Limited 4,000
No of Shares held by Ravi Company Limited 3,200
No of Shares in Minorities 800
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
Reserves on 01-04-2020
Profit and Loss Accoun as on 1-4-2020
Net Profit upto 1.11.2020 ( 1,00,000 X 7/12)
Capital Profit

Distribution of Capital Profit

Ravi Ltd = 1,78,333 X 4/5= 1,42,666
Minorities = 21,78,333 X 1/5 = 35,667

Step - 03
Calculation of Post Acquisition Profit OR Revenue Profit

Particulars Amount
Reserves created after the date of Acquisition
Net Profits from 1.11.2020 to 31.3.2021 ( 1,00,000 X 5/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

Ravi Ltd = 41,667 X 4/5 = 33,334
Minorities = 41,667 X 1/5 = 8,333

Step - 04
Calculation of Goodwill/ Cost of Control/ Capital Reserve
Particulars Amount
Purchase Price/ Investment
Add: Parent company Share of Capital Loss ( if Any)

Less: Face value of Shares held by Parent Company 320,000

Less: Parent company Share of Capital Profit 142,666
Capital Reserve

Illustration - 04
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Y Company Limited 3,000
No of Shares held by X Company Limited 3,000
No of Shares in Minorities 0
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit
 Particulars Amount
Reserves on 01-04-2019
Profit and Loss Accoun as on 1-4-2019

Capital Profit

Step - 03
Calculation of Post Acquisition Profit OR Revenue Profit

Particulars Amount
Reserves created after the date of Acquisition
Net Profits
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Step - 04
Calculation of Goodwill/ Cost of Control/ Capital Reserve
Particulars Amount
Purchase Price/ Investment
Add: Parent company Share of Capital Loss ( if Any)

Less: Face value of Shares held by Parent Company 30,000

Less: Parent company Share of Capital Profit 4,600
Capital Reserve

Illustration - 05 s
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Viranna Company Limited 9,000
No of Shares held by Parent Company Limited 5,400
No of Shares in Minorities 3,600
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves as on 31.08.2018
Profits as on 31.08.2018
Profit as on
Add: Increase in the value of Assets
Less: Decrease in the value of Land and Building
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit
Distribution of Capital Profit
Parent Ltd = 1,50,000 X3/5 = 90,000
Minorities = 1,50,000 X 2/5 = 60,000

Step - 03
Calculation of Post-Acquisition Profit OR Revenue Profit
Particulars Amount
Reserves ( 2,50,000 - 1,00,000)
Profits ( 4,00,000 - 50,000)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

Parent Ltd = 5,00,000 X3/5 = 3,00,000
Minorities = 5,00,000 X 2/5 = 2,00,000

Step - 04
Calculation of Non Controlling Interest/ Minorities Interest
Particulars Amount
Face value of Shares helb by Minorities ( 3,600 X 100)
Add: Proportionate Share of Capital Profit ( Refer Step 2)
Add: Proportionate Share of Revenue Profit ( Refer Step 3)

Less: Proportionate Share of Capital Loss ( Refer Step 2)

Less: Proportionate Share of Revenue Loss ( Refer Step 3)
Non Controlling Interest

Illustration - 06 s
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Subsidiary Company Limited 70,000
No of Shares held by Parent Company Limited 56,000
No of Shares in Minorities 14,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves as on 1.4.20219
Profits as on 1.4.2019
Profit up to 1.10.2019 ( 12,00,000 X 6/12)
Add: Increase in the value of Assets
Less: Decrease in the value of Land and Building
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit
Distribution of Capital Profit
Parent Ltd = 42,40,000 X4/5 = 33,92,000
Minorities = 42,40,000 X 1/5 = 8,48,000
Step - 03
Calculation of Post-Acquisition Profit OR Revenue Profit
Particulars Amount
Reserves
Profits ( 12,00,000 X 6/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

Parent Ltd = 6,00,000 X3/5 = 4,80,000
Minorities = 6,00,000 X 2/5 = 1,20,000

Step - 04
Calculation of Non Controlling Interest/ Minorities Interest
Particulars Amount
Face value of Shares helb by Minorities ( 14,000 X 10)
Add: Proportionate Share of Capital Profit ( Refer Step 2)
Add: Proportionate Share of Revenue Profit ( Refer Step 3)

Less: Proportionate Share of Capital Loss ( Refer Step 2)

Less: Proportionate Share of Revenue Loss ( Refer Step 3)
Non Controlling Interest

Illustration - 07 s
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Subsidiary Company Limited 40,000
No of Shares held by Parent Company Limited 30,000
No of Shares in Minorities 10,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves
Profits as on 1.4.2019
Profit
Add: Increase in the value of Assets
Less: Decrease in the value of Land and Building
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit
Distribution of Capital Profit
Parent Ltd = 60,000 X3/4 = 45,000
Minorities = 60,000 X 1/4 = 15,000

Step - 03
Calculation of Post-Acquisition Profit OR Revenue Profit
Particulars Amount
Reserves
Profits ( 12,00,000 X 6/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Step - 04
Calculation of Goodwill/ Cost of Control/ Capital Reserve
Particulars Amount
Purchase Price/ Investment
Add: Parent company Share of Capital Loss ( if Any)

Less: Face value of Shares held by Parent Company 300,000

Less: Parent company Share of Capital Profit 45,000
Goodwill

Illustration - 08 s
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Subsidiary Company Limited 100,000
No of Shares held by Parent Company Limited 60,000
No of Shares in Minorities 40,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves as on 1.4.20218
Profits as on 1.4.2018
Profit up to 1.7.2018 ( 1,00,000 X 3/12)
Add: Increase in the value of Assets
Less: Decrease in the value of Land and Building
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit
Distribution of Capital Profit
Parent Ltd = 1,65,000 X3/5 = 99,000
Minorities = 1,65,000 X 2/5 = 66,000

Step - 03
Calculation of Post-Acquisition Profit OR Revenue Profit
Particulars Amount
Reserves
Profits ( 10,00,000 X 9/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

Parent Ltd = 75,000 X3/5 = 45,000
Minorities = 75,000 X 2/5 = 30,000

Step - 04
Calculation of Non Controlling Interest/ Minorities Interest
Particulars Amount
Face value of Shares helb by Minorities ( 40,000 X 10)
Add: Proportionate Share of Capital Profit ( Refer Step 2)
Add: Proportionate Share of Revenue Profit ( Refer Step 3)

Less: Proportionate Share of Capital Loss ( Refer Step 2)

Less: Proportionate Share of Revenue Loss ( Refer Step 3)
Non Controlling Interest

Illustration - 09 s
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Subsidiary Company Limited 40,000
No of Shares held by Parent Company Limited 30,000
No of Shares in Minorities 10,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves as on 1.4.2018
Profits as on 1.4.2018
Profit up to 1.7.2018 ( 3,00,000 X 3/12)
Add: Increase in the value of Assets
Less: Decrease in the value of Land and Building
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit
Distribution of Capital Profit
Parent Ltd = 2,15,000 X3/4 = 1,61,250
Minorities = 2,15,000 X 1/4 = 53,750

Step - 03
Calculation of Post-Acquisition Profit OR Revenue Profit
Particulars Amount
Reserves
Profits ( 3,00,000 X 9/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

Parent Ltd = 2,25,000 X3/4 = 1,68,750
Minorities = 2,25,000 X 1/4 = 56,250

Step - 04
Calculation of Non Controlling Interest/ Minorities Interest
Particulars Amount
Face value of Shares helb by Minorities ( 10,000 X 10)
Add: Proportionate Share of Capital Profit ( Refer Step 2)
Add: Proportionate Share of Revenue Profit ( Refer Step 3)
Less: Proportionate Share of Capital Loss ( Refer Step 2)
Less: Proportionate Share of Revenue Loss ( Refer Step 3)
Non Controlling Interest

Illustration - 10 s
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Subsidiary Company Limited 80,000
No of Shares held by Parent Company Limited 60,000
No of Shares in Minorities 20,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves as on 1.4.2019
Profits as on 1.4.2019
Profit ( 2,00,000 X 9/12)
Add: Increase in the value of Assets
Less: Decrease in the value of Land and Building
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit
Distribution of Capital Profit
Parent Ltd = 3,90,000 X3/4 = 2,92,500
Minorities = 3,90,000 X 1/4 = 97,500

Step - 03
Calculation of Post-Acquisition Profit OR Revenue Profit
Particulars Amount
Reserves
Profits ( 2,00,000 X 3/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

Parent Ltd = 50,000 X3/4 = 37,500
Minorities = 50,000 X 1/4 = 12,500

Step - 04
Calculation of Goodwill/ Cost of Control/ Capital Reserve
Particulars Amount
Purchase Price/ Investment
Add: Parent company Share of Capital Loss ( if Any)

Less: Face value of Shares held by Parent Company 600,000

Less: Parent company Share of Capital Profit 292,500
Capital Reserve

Illustration - 11 s
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Subsidiary Company Limited 10,000
No of Shares held by Parent Company Limited 7,000
No of Shares in Minorities 3,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves as on 1.4.2019
Profits as on 1.4.2019
Profit
Add: Increase in the value of Assets
Less: Decrease in the value of Land and Building
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit
Distribution of Capital Profit
Parent Ltd = 80,000 X7/10 = 56,000
Minorities = 80,000 X 3/10 = 24,000

Step - 03
Calculation of Post-Acquisition Profit OR Revenue Profit
Particulars Amount
Reserves
Profits ( 2,00,000 X 3/12)
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

Step - 04
Calculation of Goodwill/ Cost of Control/ Capital Reserve
Particulars Amount
Purchase Price/ Investment
Add: Parent company Share of Capital Loss ( if Any)

Less: Face value of Shares held by Parent Company 70,000

Less: Parent company Share of Capital Profit 56,000
Goodwill
Illustration - 12 s
Step - 01
Calculation of Ratio of Parent Entity
Total no of Shares in Subsidiary Company Limited 5,000
No of Shares held by Parent Company Limited 4,000
No of Shares in Minorities 1,000
Step - 02
Calculation of Pre-Acquisition Profit OR Capital Profit

Particulars Amount
G. Reserves as on 1.4.2017
Profits as on 1.4.2019
Profit
Add: Increase in the value of Assets
Less: Decrease in the value of Land and Building
Add: Decrease in the Amount of Liabilities
Less: Increase in the Amount of Liabilities
Capital Profit
Distribution of Capital Profit
Parent Ltd = 1,30,000 X4/5 = 1,04,000
Minorities = 1,30,000 X 1/5 = 26,000

Step - 03
Calculation of Post-Acquisition Profit OR Revenue Profit
Particulars Amount
Reserves
Profits
Add: Excess of Depreciation charged on Decreased value of Assets
Less: Under Depreciation charged on Increased value of Asset
Revenue Profit

Distribution of Revenue Profit

Parent Ltd = 40,000 X4/5 = 32,000
Minorities = 40,000 X 1/5 = 8,000

Step - 04
Calculation of Goodwill/ Cost of Control/ Capital Reserve
Particulars Amount
Purchase Price/ Investment
Add: Parent company Share of Capital Loss ( if Any)

Less: Face value of Shares held by Parent Company 400,000

Less: Parent company Share of Capital Profit 104,000
Capital Reserve

Step - 05
Calculation of Non Controlling Interest/ Minorities Interest
Particulars Amount
Face value of Shares helb by Minorities ( 1,000 X 100)
Add: Proportionate Share of Capital Profit ( Refer Step 2)
Add: Proportionate Share of Revenue Profit ( Refer Step 3)

Less: Proportionate Share of Capital Loss ( Refer Step 2)

Less: Proportionate Share of Revenue Loss ( Refer Step 3)
Non Controlling Interest
7:03

Amount
100,000
80,000
30,000
-
-
-
-
210,000

Amount
0
90,000

90,000

Amount
300,000
63,000
27,000

390,000

Amount
.48:32` 3:02

Amount
160,000
60,000
60,000
280,000

Amount
0
60,000

60,000
Amount
4,800,000
0

4,968,000
-168,000

.32:8 4:1`

Amount
60,000 1.4.2020 1.11.2020 31.3.2021
60,000
58,333
178,333
Amount
0
41,667

41,667

Amount
400,000
0

462,666
-62,666

3:00
Amount
4,000
600

4,600

Amount
0
3,000

3,000

Amount
50,000
0

34,600
15,400

27:18:00
9:06
.54:36 3:02

Amount
100,000
50,000

200,000
-200,000
-
-
150,000

Amount
150,000
350,000

500,000
 Amount
360,000
60,000
200,000

620,000

.56:14 4:01

Amount
1,400,000
2,240,000
600,000

-
4,240,000
Amount
0
600,000

600,000

Amount
140,000
848,000
120,000

1,108,000
.3:1

Amount

60,000

-
60,000

Amount

Amount
400,000
0

345,000
55,000

.6:4 .3:2

Amount
80,000
60,000
25,000

-
165,000

Amount
0
75,000

75,000

Amount
400,000
66,000
30,000

496,000

.3:1

Amount
 100,000
40,000
75,000

-
215,000

Amount
0
225,000

225,000

Amount
100,000
53,750
56,250
210,000

3:01

Amount
120,000
120,000
150,000

-
390,000

Amount
0
50,000
 50,000

Amount
800,000
0

892,500
-92,500

.7:3

Amount
100,000
 20,000

-
80,000

Amount
0

Amount
160,000
0

126,000
34,000
.4:1

Amount
100,000
30,000
0

-
130,000

Amount
0
40,000

40,000
Amount
500,000

504,000
-4,000

Amount
100,000
26,000
8,000

134,000