How are intra-entity transfers reported in an investee’s separate financial statements if the investor is using the equity method?
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Q: When is the intra-entity’s profits recognized on transfers between the investor and investee?
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A:
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How are intra-entity transfers reported in an investee’s separate financial statements if the investor
is using the equity method?
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- When is the intra-entity’s profits recognized on transfers between the investor and investee?Please concisely explain how the excess investment cost over book value is allocated. When is the intra-entity’s profits recognized on transfers between the investor and investee? What is the controlling interest percentage for a consolidated accounting financial statement?When an entity prepares separate financial statements, it shall account for investments in associates A. At cost. B. Any of the choices. C. In accordance with PFRS 9. D. Using the equity method as described in PAS 28.
- The cost of registering equity securities in a business combination should be recorded asExplain common forms of business ownership—soleproprietorship, partnership, and corporation—and demonstrate how they differ in terms of their pre-sentation in the statement of financial position.Which of the following statements is TRUE regarding the equity method? A. The equity method is used for reporting gains or losses for non-strategic investments. B. The investor's share of the associate's dividends declared is reported as revenue. C. The investor's investment in the associate changes in direct relation to the changes taking place in the associate's equity accounts. D. The equity method reports unrealized gains and losses on revaluations to fair value in net income.
- When an investor uses the equity method to account for investments in common stock, the investor’s share of cash dividends from the investee should be recorded as A deduction from the investor’s share of the investee’s profits. Dividend income. A deduction from the stockholders’ equity account, Dividends to Stockholders. A deduction from the investment account. (AICPA adapted)Investors sometimes transfer assets to investee’s shareholders other than cash and investor’s stock. How should theses transferred assets be accounted for the acquisition?Choose the correct. Under fair-value accounting for an equity investment, which of the following affects the income the investor recognizes from its ownership of the investee?a. The investee’s reported income adjusted for excess cost over book value amortizations.b. Changes in the fair value of the investor’s ownership shares of the investee.c. Intra-entity profits from upstream sales.d. Other comprehensive income reported by the investee.
- Under fair-value accounting for an equity investment, which of the following affects the income the investor recognizes from its ownership of the investee? The investee’s reported income adjusted for excess cost over book value amortizations. Changes in the fair value of the investor’s ownership shares of the investee. Intra-entity profits from upstream sales. Other comprehensive income reported by the investee.Which of the following must be included on the face of the statement of financial position? Investment property Number of shares authorized Contingent asset Shares in an entity owned by that entityThe cost of registering equity securities in a business combination should be capitalized debited to share premium expensed