Reviewing CFAI afternoon mock, Q26 & 28 (Yee), and I’m confused by the following assumptions:
-
When calculating EV, non-controlling interest is added…my understanding is if I want to buy the entire firm, EV is a good number because it represents the entire firm, including parts of the firm owned by someone else. That makes sense.
-
When calculating BVPS, non-controlling interest is ignored…can someone help me understand why? This is in a residual income question.
