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Subject Topic: Recording NCI Equity and earnings (Topic Closed Topic Closed) Post ReplyPost New Topic
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Joined: 30 Mar 2010
Online Status: Offline
Posts: 130
Posted: 17 May 2010 at 10:17 | IP Logged  

I'm a little confused about how these are recorded. Becker kind of
describes it, but never gives the presentation.

It seems to me that NCI is initially recorded separately in the equity
section as it's own item for it's % interest in the sub. Then it states that
the NCI's portion of the sub's income is basically appropriated within
retained earnings. So, based on that it seems the NCI's equity and it's
portion of sub income are separate. But the way Becker describes the
NCI's share of sub income and losses it seems like the NCI's share of
income and loss is rolled into it's equity account.

If anyone can clarify or maybe do a quick mock-up of the parent equity
section showing where NCI items are presented, I would really appreciate

FAR: 84 Becker
REG: 95 Becker
BEC: 88 Becker
AUD: 88 Gleim
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Joined: 15 Oct 2009
Online Status: Offline
Posts: 238
Posted: 17 May 2010 at 11:35 | IP Logged  

When you buy a sub less 100% ownership you create NCI equity account and show it on your balance sheet. Every year when you record your consolidation entries credit the NCI Equity. This is how you do it.

Retained Earnings
     Investment in Sub
     NCI Equity

     Investment in Sub
     NCI Equity

When you determine income from Sub, part of it goes to NCI, this is the journal entry to record.

NCI Income/Expense
      NCI Equity

Debit goes on consolidated Net Income and the credit gets closed to NCI equity.

FAR - 92
AUD - 82
REG - 83
BEC - 90

Becker 2009 and Gleim 2010, Wiley 13.0
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