EOCQ Reading 21 #26

HELP! Why does it use 1,750 as the denominator (equity value) when calculating debt-to-equity under the consolidation method? Shouldn’t it be 2,010? Thanks!

You don’t combine equity–only A & L. Minority interest is calculated as acquiree’s equity x minority interest %, and this is the only isntance it is considered.

ok, so just NinMount’s Equity + purchase price for Boswell’s net assets?

of course…that would be double counting. got it.