HELP! FRA- Intercorp.

This is in reference to CFAI mock 2010 question no. 36

Question is what will be the parent’s Shareholder’s equity after consolidation of balance sheet under US GAAP ?

Solution – 1300 (Parent’s equity ) + 1000*0.5 (subsidiary’s equity) = 1800

Do we add equity in parents b/s under any of the three methods – Equity , Proportionate consolidation or Consolidation ?

Parent’s equity is unchanged under Eguity Method and Proportionate Consolidation, but is higher by non-controlling (minoroty) interest in Acquisition Method.