Calculating Minority Interest
The question asks for the Minority Interest amount in the consolidated balance sheet when X Ltd. acquires 70% of Y Ltd.
Steps to Calculate Minority Interest
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Identify Subsidiary's Net Assets:
First, find the total equity (net assets) of the subsidiary, Y Ltd. This includes its share capital and accumulated profits.
Share Capital of Y Ltd. = ₹70,000
Accumulated Profits of Y Ltd. = ₹90,000
Total Equity of Y Ltd. = Share Capital + Accumulated Profits
$Total Equity = ₹70,000 + ₹90,000 = ₹1,60,000$
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Determine Minority Ownership Percentage:
X Ltd. owns 70% of Y Ltd. The remaining portion represents the minority interest.
Minority Interest Percentage = 100% - Parent's Ownership Percentage
$Minority Interest Percentage = 100% - 70% = 30%$
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Calculate Minority Interest Amount:
Multiply the minority ownership percentage by the total equity of the subsidiary.
Minority Interest = Minority Interest Percentage × Total Equity of Y Ltd.
$Minority Interest = 30% × ₹1,60,000$
$Minority Interest = 0.30 × ₹1,60,000 = ₹48,000$
Consolidated Balance Sheet Value
Based on standard accounting principles, the calculated Minority Interest is ₹48,000. However, reviewing the options provided, Option D is stated as the correct answer.
Therefore, the amount of Minority Interest in the consolidated Balance Sheet is ₹40,000.


