Neco 2019 Financial Accounting Question 30

Parent company P acquires 80 % of subsidiary S on 1 January 2022 for ₦4,800,000. At acquisition the fair value of S's identifiable net assets is: Share capital ₦1,200,000; Retained earnings ₦600,000; Revaluation surplus ₦200,000; Property, plant (fair value) ₦2,500,000 (carrying amount ₦2,000,000). The excess of purchase price over fair value of net assets is goodwill. During 2022 S reports profit before tax of ₦500,000, pays tax at 30 % and declares a cash dividend of ₦150,000 (paid to all shareholders). S also records a management fee of ₦50,000 payable to P (recorded as expense by S and income by P). Assume goodwill has an indefinite life (no amortisation). Prepare the consolidated statement of profit for the year, showing the amount of goodwill (no amortisation), eliminating inter‑company profit, and compute the amount attributable to non‑controlling interest (NCI) in profit.