The non-controlling interest in net assets of a partially owned subsidiary is: O Decreased by amortization of differences between fair values and carrying values of the subsidiary's net assets net assets when carrying values are greater than fair values. O Decreased by share in impairment loss in goodwill, if proportionate method of measuring NCI is used Increased by the NCI's share of subsidiary's dividends and decreased by the NCI's share of subsidiary's adjusted net income O Decreased by the NCI's share of subsidiary's dividends and increased by the NCI's share of

The non-controlling interest in net assets of a partially owned subsidiary is: O Decreased by amortization of differences between fair values and carrying values of the subsidiary's net assets net assets when carrying values are greater than fair values. O Decreased by share in impairment loss in goodwill, if proportionate method of measuring NCI is used Increased by the NCI's share of subsidiary's dividends and decreased by the NCI's share of subsidiary's adjusted net income O Decreased by the NCI's share of subsidiary's dividends and increased by the NCI's share of

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter14: Intercorporate Investments In Common Stock

Section: Chapter Questions

Problem 8Q

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The non-controlling interest in net assets of a partially owned subsidiary is: a. Decreased by amortization of differences between fair values and carrying values of the subsidiary’s net assets net assets when carrying values are greater than fair values. b. Decreased by share in impairment loss in goodwill if proportionate method of measuring NCI is used c. Increased by the NCI’s share of subsidiary’s dividends and decreased by the NCI’s share of subsidiary’s adjusted net income d. Decreased by the NCI’s share of subsidiary’s dividends and increased by the NCI’s share of subsidiary’s adjusted net income
Which of the following is correct? A. The noncontrolling shareholders' claim on the subsidiary's net asset is based on the book value of the subsidiary's net assets. B. Only the parent's portion of the differences between book value and fair value of the subsidiary's assets is assigned to those assets. C. Goodwill represents the difference between the book value of the subsidiary's net assets and the amount paid by the parent to buy ownership. D. Total assets reported by the parent generally will be less than the total assets reported on the consolidated balance sheet.
PLEASE ANSSWER ASAP. WILL DO THUMBS UP. 1. Assuming the Parent entity elects to measure the NCI at proportionate basis, the computation of non- controlling interest in net income of subsidiary is reduced by the following, except: O Amortization of undervalued assets O All of the above O Amortization of overvalued liabilities O Impairment loss of goodwill 2. Which of the following statements is correct? Statement 1: Any unrealized profit or loss made by the subsidiary should be eliminated from its profit. Statement 2: only the group portion of any unrealized profit need to be eliminated. a. both I and II b. I c. Neither 1 or 2 d. II
Which of the following is not typical of the journal entries prepared by a parentcompany to account for its subsidiary’s operations under the cost method ofaccounting A. A credit to the intercompany dividend income account B. Deprecation and amortization of differences between current fair values and book values of the subsidiary’s identifiable net assets on the date of the acquisition. C. None of the foregoing. D. Accrual of the parent company’s share of the subsidiary’s net income or loss
Under the Cost Method A. The parent’s investment in the Subsidiary is recorded at cost and reduced by an excess dividends received from subsidiary. B. The parent’s investment in the subsidiary is recorded at cost, and never changed thereafter. C. The parent records its pro rata share of the subsidiary’s post-acquisition income as an increase to the investment account and reduces the investment account with its share of the dividends declared by the subsidiary. D. The parent records it pro rata share of the subsidiary’s cumulative earnings as an increase to the investment account and reduces the investment account with its share in the dividends declared by the subsidiary
In determining controlling interest in consolidated income in the consolidated financial statements, unrealized intercompany profit on inventory acquired by a parent from its subsidiary should: a. Not be eliminated b. Be eliminated to the extent of the non-controlling interest in the subsidiary. c. Be eliminated to the extent of the parent company’s controlling interest in the subsidiary d. Be eliminated in full
Under the Cost Method The parent records its pro rata share of the subsidiary’s post-acquisition income as an increase to the investment account and reduces the investment account with its share of the dividends declared by the subsidiary. The parent’s investment in the subsidiary is recorded at cost, and never changed thereafter. The parent records it pro rata share of the subsidiary’s cumulative earnings as an increase to the investment account and reduces the investment account with its share in the dividends declared by the subsidiary The parent’s investment in the Subsidiary is recorded at cost and reduced by an excess dividends received from subsidiary.
In the consolidated statement of comprehensive income to be prepared by the parent corporation, which of the following items will affect both consolidated net income attributable to parent and non-controlling interest in net income? Impairment loss on goodwill recognized when the noncontrolling interest is measured at proportionate share of fair value of net assets of subsidiary. Amortization of difference between fair value and book value of liability of subsidiary. Realization of unrealized gain or (loss) from sale of parent company to subsidiary company. Recognition of gain on bargain purchase arising from business combination.
Which of the following is not typical of the journal entries prepared by a parent company to account for its subsidiary’s operations under the cost method of accounting Accrual of the parent company’s share of the subsidiary’s net income or loss A credit to the intercompany dividend income account Deprecation and amortization of differences between current fair values and book values of the subsidiary’s identifiable net assets on the date of the acquisition. None of the foregoing.
Given the following information, how is goodwill from a business combinationcomputed under PFRS 3? A = Consideration transferred; B = Non-controllinginterest in net assets of subsidiary; C = Previously held equity interest; D = Fairvalue of net identifiable assets of subsidiary; % = Percentage of ownershipacquired by the parent in the subsidiary A. (A+B) – [(D x %) – B]B. A – (D x %)C. (A+C) – (D x %)D. A+B+C-D
Which of the following income items may affect both Consolidated Net Income attributable to Parent and Non-Controlling Interest in Profit? * A. Gain on bargain purchase arising from business combination. B. Gain (loss) arising from intercompany sale of fixed assets from parent to subsidiary. C. Answer not given D. Amortization of excess in merchandise inventory of the acquired company. E. Impairment of a goodwill recognized using the proportionate or relevant share.
Consolidated net income for a parent company and its partially owned subsidiary is best defined as the parent company’sA. Recorded net income plus the subsidiary’s recorded net income after adjustment from any amortization of excess amount from book value compared to fair value.B. Recorded net incomeC. Income from independent operations plus subsidiary’s income resulting from transactions with outside parties after adjustment from any amortization of excess amount from book value compared to fair value.D. Recorded net income plus the subsidiary’s recorded net income