1.On 1 January 20X4, Lyon acquired 75% of the voting equity shares of Drake by paying $800,000 cash and issuing 50,000 of its own $1 equity shares. At that date, Drake had net assets of 1,000,000.

On 1 January 20X4, the fair value of shares in Lyon was $1.50 per share and the fair value of the non-controlling interest in Drake was $225,000.

What was the goodwill arising on acquisition of Drake?

a.

$100,000

b.

$25,000

c.

$75,000

d.

$125,000

On 30 September 20X7, H acquired 75% of the share capital of S. The non-controlling 5 interest had a fair value of $900,000.

Extracts from the statement of financial position of S at 30 September 20X7 and 30 September 20X8 are shown below:

Statement of financial position:

	20X7 $	20X8 $
Ordinary share capital	500,000	500,000
Retained earnings	2,800,000	3,400,000

2.What figure for non-controlling interest should appear in the consolidated statement of financial position as at 30 September 20X8?

a.

$1,050,000

b.

$975,000

c.

$825,000

d.

$900,000