Question
Red bought 75% of Blue on 1 July 2014, at a cost of 2 million. The non-controlling interest was recorded at its initial fair value
Red bought 75% of Blue on 1 July 2014, at a cost of 2 million. The non-controlling interest was recorded at its initial fair value of 500,000. The fair value of Blues net assets as at acquisition was 1,750,000. During the year ended 30 June 2015, an impairment of 20% was recognised in relation to the goodwill for Blue.
A further 10% impairment has been recorded for the current year, based on the carrying amount at 1 July 2015.
What is the impairment charge to be included in the consolidated statement of profit or loss for the year ended 30 June 2016?
A 60,000
B 75,000
C 210,000
D 225,000
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