In Reading a Set of Consolidated Financial Statements You Are

question 17

Essay

In reading a set of consolidated financial statements you are surprised to see the term noncontrolling interest not reported under the Liability section of the Balance Sheet.
Required:
a.What is a noncontrolling interest?
b.Why must it be reported in the financial statements as an element of equity rather than a liability?

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Definitions:

Amygdala

An area of brain tissue, with extensive connections to the olfactory system and hypothalamus, thought to be involved in mood, feeling, instinct, and short-term memory.

Cerebellum

Part of the brain that controls balance and muscular coordination.

Critical Thinking Skills

The capacity for objective analysis and evaluation of an issue in order to form a judgment.

Critical Thinking Dispositions

A willingness or tendency to think critically, which involves analyzing, synthesizing, and evaluating information to form a reasoned judgment.