[palal9923]

Hello everybody,

Quick Question-

The “CAR IN BIG” used by becker.

IN

I- Investment in Sub

N- Non Controlling Interest

is the “I” supposed to be amount paid/ % you own ( ie the fair value)

or would it just be the amount you paid to acquire stock of company A (or whatever company you are acquiring stock of)

[misanthrope87]

Fair value of the amount you paid to acquire.

B 2/12 87
A 11/11 90
R 8/11 86
F 5/12 88

[palal9923]

what about for equity method, would you do the same thing, or would the “investment” amount be whatever the amount you paid for company A was?

[misanthrope87]

Yes the fair value of what you paid.

B 2/12 87
A 11/11 90
R 8/11 86
F 5/12 88

[Anonymous]

@palal9923 – The equity method doesn't use the CARINBIG mnemonic…every question I've gone through has stated the amount paid for the share of the company being invested in. Then you have to take the percentage gained by the investment times the book/FV's to come up with any potential goodwill allocation.

[Author]

Replies