PFRS 3 requires that all business combination be accounted for using a. the pooling interest method b. the acquisition method c. either the pooling of interest or acquisition methods d. neither the pooling of interest nor acquisition methods
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- Q2 Which of the following methods of accounting are permitted under IAS 31? Select one: a. Full consolidation and interest method b. Proportionate consolidation and equity method c. Proportionate consolidation and full consolidation d. Full consolidation and equity method(TCO B) How are accounting for direct costs, indirect costs, and issuance costs reflected under the acquisition method of accounting for a business combination?Under PFRS 3, when is a gain recognized in consolidating financial information? a. In a combination created in the middle of the fiscal year b. In an acquisition when the value of all assets and liabilities cannot be determined. c. When any bargain purchased is created d. When the amount of a bargain purchase exceeds the value of the applicable liability held by the acquired company.
- Under PFRS 3, when is a gain recognized in consolidating financial information? Group of answer choices a.When the amount of a bargain purchase exceeds the value of the applicable liability held by the acquired company. b.In an acquisition when the value of all assets and liabilities cannot be determined. c.When any bargain purchased is created d.In a combination created in the middle of the fiscal yearAcquisition accounting requires an acquirer and an acquirer to be identified for every business combination. Where a new entity (H) is created and two pre-existing entities, S and A, which of these entities will be designated as the acquirer? a. H b. S or A c. S d. AExplain the key steps in the acquisition method in accounting for business combination. Why Fair value is the rule?
- (CO 3) Which of the following statements is true concerning an intra-entity transfer of a depreciable asset? Group of answer choices Net income attributable to the non-controlling interest is never affected by a gain on the transfer. Net income attributable to the non-controlling interest is always affected by a gain on the transfer. Net income attributable to the non-controlling interest is affected by a downstream gain only Net income attributable to the non-controlling interest is affected only when the transfer is upstream. Net income attributable to the non-controlling interest is increased by an upstream gain in the year of transfer.Acquisition accounting requires an acquirer and an acquirer to be identified for every business combination. Where a new entity (H) is created and two pre-existing entities, S and A, which of these entities will be designated as the acquirer? H S A S or AConsider the following: I. The two important elements in the definition of business combination under PFRS 3 are “business” and “combination.” II. Under PFRS 3 Business Combinations, business combinations are accounted for using the purchase method. * A. False, false B. True, false C. False, true D. True, true
- S1: The acquisition-related costs in a business combination to be expensedimmediately include cost of issuing debt securities. S2: In a business combination any “gain on bargain purchase” shall be recognized in other comprehensive income. A. Only S1 is correct.B. Only S2 is correct.C. Both statements are incorrect.D. Both statements are correct.Which of the following items would most likely be classifi ed as an operating activity? B . Acquisition of a competitor.1. IFRS 3 defines it as a transaction or other event in which an acquirer obtains control of one or more businesses.