The non-controlling interest in net assets of a partially owned subsidiary is: O Decreased by share in impairment loss in goodwill if proportionate method of measuring NCI is used 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 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 subsidiary's adjusted net income

The non-controlling interest in net assets of a partially owned subsidiary is: O Decreased by share in impairment loss in goodwill if proportionate method of measuring NCI is used 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 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 subsidiary's adjusted net income

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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
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 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.
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
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.
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
From a consolidated point of view, the intercompany gain or loss on a parent’s sale of a non-depreciable asset to subsidiary is realized when: a. The parent company sells the asset to the subsidiary b. The subsidiary start to use the asset c. The subsidiary resells the asset to the parent d. The subsidiary resells the asset to the outsider
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
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
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
Statement 1: Non-controlling interest in subsidiary's net income is never affected by a gain on the transfer of depreciable asset. Statement 2: When change in the estimated life of depreciable assests occurs at the time of an intercompany sales, the treatment is different than if the change occured while the asset remained on the books of the selling affiliate . Which statement/s is TRUE?
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.