When preparing and presenting a consolidated statement of comprehensive income, the non-controlling interest is:
A)Presented as a separate component of revenue.
B)Shown as a separate component of profit before tax and a separate component of tax expense.
C)Shown as a separate component of each line item.
D)Presented as an allocation of profit or loss attributable to the non-controlling interest.

Question

Quizplus · Accepted Answer

The non-controlling interest refers to the portion of equity in the subsidiary that is not owned by the parent company. When preparing a consolidated statement of comprehensive income, the non-controlling interest is shown as an allocation of profit or loss attributable to the non-controlling interest. This means that it is presented as a separate line item within the consolidated statement, detailing the portion of profits that belong to the non-controlling interest. Therefore, choice D is the best option. Choices A, B, and C are not correct as they do not accurately reflect the treatment of the non-controlling interest in a consolidated statement of comprehensive income.

When Preparing and Presenting a Consolidated Statement of Comprehensive Income