Under the full goodwill method:
I made a change to the original question, as the original question is very similar to Q3 of the SPQ.
A) the NCI does not get a share of any equity relating to goodwill.
B) only goodwill acquired by parent entity will be recognised.
C) the NCI is measured at the NCI's proportionate share of the acquiree's identifiable assets and liabilities.
D) acquired goodwill consists of both goodwill of the subsidiary and the premium paid by the parent to acquire control over the subsidiary.

Question

Quizplus · Accepted Answer

Under the full goodwill method, the acquired goodwill consists of both the goodwill of the subsidiary and the premium paid by the parent to acquire control over the subsidiary. Therefore, option D is the correct choice. Option A is incorrect because the NCI is entitled to a share of the equity relating to goodwill. Option B is incorrect because under the full goodwill method, all goodwill arising from the acquisition is recognised by the parent, not just the goodwill of the subsidiary. Option C is also incorrect because the NCI is measured at the NCI's proportionate share of the acquiree's net identifiable assets, not just identifiable assets and liabilities.

Under the Full Goodwill Method