Company A Limited owns 90% of the share capital of Company B Limited. Company B Limited paid a dividend of $20 000 during the financial period. The NCI adjustment entries in the consolidation worksheet for the dividend include:
A) Dr Dividend revenue $2 000.
B) Cr Dividend revenue $2 000.
C) Dr Dividend payable $2 000.
D) Dr NCI $2 000.

Question

Quizplus · Accepted Answer

The Non-Controlling Interest (NCI) holds 10% of Company B, so they are entitled to 10% of the dividend, which is $2,000. The entry would be to debit NCI for their share of the dividend.

Company a Limited Owns 90% of the Share Capital of Company