Based on the facts given in the aforementioned part (i), assume that, Entity A estimates the fair value of the shares it owns in company XYZ using a…
CA Final · Financial Reporting · MTP · November 2024
Based on the facts given in the aforementioned part (i), assume that, Entity A estimates the fair value of the shares it owns in company XYZ using a net asset valuation technique. The fair value of company XYZ's net assets including those recognised in its balance sheet and those that are not recognised is 8,50,000. Determine the fair value of Entity A's investment in XYZ's shares. (5 Marks)
Suggested Answer and Working Notes:
Share price = 8,50,000 ÷ 5,000 shares = 170 per share. The fair value of Entity A's investment in XYZ shares is estimated to be - 42,500 (250 shares x 170 per share).
Topics: Ind AS 113
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