Well if you own say 10% of a company, then you are entitled to 10% of the profits.
Say you buy a Guinness in the Guinness Factory bar in Dublin.
Perhaps cost of 50p for a £5 pint (just making up numbers).
So Diageo makes £4.50p (gross) profit out of you.
You only have the right to 10% of that profit so 45p. The other holders of the company (who hold 90%) have the right to the other £4.05.
So your Guinness cost you £5 less the profits you own, 45p. Your Guinness net cost was £4.55p.
Obviously if you owned the whole company the cost would only be 50p since you have the right to ALL the profits. Your cost would be £5 less the £4.50p so 50p. i.e. cost price.
Well if you own say 10% of a company, then you are entitled to 10% of the profits.
Say you buy a Guinness in the Guinness Factory bar in Dublin.
Perhaps cost of 50p for a £5 pint (just making up numbers).
So Diageo makes £4.50p (gross) profit out of you.
You only have the right to 10% of that profit so 45p. The other holders of the company (who hold 90%) have the right to the other £4.05.
So your Guinness cost you £5 less the profits you own, 45p. Your Guinness net cost was £4.55p.
Obviously if you owned the whole company the cost would only be 50p since you have the right to ALL the profits. Your cost would be £5 less the £4.50p so 50p. i.e. cost price.