A Ltd Holds a 60% Interest in B Ltd

question 42

Multiple Choice

A Ltd holds a 60% interest in B Ltd. On 30 June 2016 B Ltd transferred a depreciable non-current asset to A Ltd at a profit of $5 000. The remaining useful life of the asset at the date of transfer was 4 years and the tax rate is 30%. The impact of the above transaction on the NCI share of profit at 30 June 2016 is:

• A) an increase of $1 400.
• B) a decrease of $1 400.
• C) an increase of $3 500.
• D) a decrease of $3 500.

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