FSA: business combination-purchase method

although it uses consolidation method, but I noticed it lead to the same equity for aquirer , but different NI for aquirer. I am now very confused about equity, proportionate consolidation and consolidation, as sometimes it could reach the same equity/NI, sometime not. And I think I’ve seen somewhere that said under three method, NI and equity will be the same. if in the exam, it ask make a statement about NI/equity will be the same under equity/proportionate and full consolidation, I am not sure if I could get correct answer…

NI = same under all three Equity = same under equity method and proportionate consolidation, higher under full consolidation (if there is NCI) If you’re having issues, work through some problems that have to consolidate under all three methods. It’s very tricky stuff; this is my third course on this material and I still sometimes have issues.

Under full consolidation, the equity should be higher than equity and proportionate method because minority interest are added to equity in full consolidation. Net income is the same for the 3 methods.