When preparing the consolidated financial statements, which of the following should be deducted from the group reserves? a) Share in associate profit b) Value of the loan from subsidiary to associate c) Group’s share of sub-subsidiary’s profit d) Value of goodwill impairment expense
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1. When preparing the consolidated financial statements, which of the following
should be deducted from the group reserves?
a) Share in associate profit
b) Value of the loan from subsidiary to associate
c) Group’s share of sub-subsidiary’s profit
d) Value of
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- when preparing the consolidated financial statements, which of the following should be deducted from the group reserves? a. share in associate profit b. value of the loan from subsidary to associate c. group's share of sub-subsidary profit d. value of goodwill impairment expensePlease 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?If the entity is using the equity method to account for investment in subsidiary, the entry to recognize dividends received from the subsidiary will: a.Be recognized in profit or loss b.Increase the carrying amount of investment c.Decrease the carrying amount of investment d.Be recognized in other comprehensive income
- Determine the consolidated balances which Peris would present on their consolidated balance sheet for the following accounts. Cash Inventory Construction permits Goodwill Notes Payable Common Stock Additional Paid-in Capital Retained EarningsIn 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.An appropriation of accumulated profits for possible contingencies should be a. Transferred to income as losses are realized b. Shown within shareholders’ equity in the statement of financial position c. Charged with all losses related to that contingency d. Classified in the liability section of the statement of financial position
- REQUIRED 1. Prepare a schedule to assign the difference between the fair value of the investment in Set and the book value of the interest to identifiable and unidentifiable net assets. 2. Prepare a consolidated balance sheet for Par Corporation and Subsidiary at January 1, 2011.S1: Current fair value of the investment adjusted for dividends receiveddescribes the amount at which a parent company reports its investment in aSubsidiary under the cost method for periods subsequent to the businesscombination. S2: Under the cost method of accounting for investment,depreciation and amortization of the allocated difference between the fairvalues and book values of acquired subsidiary’s identifiable net assets is debitedto the Subsidiary’s expense accounts, in the working paper. A. Both statements are incorrectB. Only S2 is correctC. Only S1 is correctD. Both statements are correctConsolidated 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
- Choose the correct. In computing the noncontrolling interest’s share of consolidated net income, how should the subsidiary’s net income be adjusted for intra-entity transfers? a. The subsidiary’s reported net income is adjusted for the impact of upstream transfers prior to computing the noncontrolling interest’s allocation. b. The subsidiary’s reported netincome is adjusted for the impact of all transfers prior to computing the noncontrolling interest’s allocation. c. The subsidiary’s reported net income is not adjusted for the impact of transfers prior to computing the noncontrolling interest’s allocation. d. The subsidiary’s reported net income is adjusted for the impact of downstream transfers prior to computing the noncontrolling interest’s allocation.In computing the noncontrolling interest’s share of consolidated net income, how should the subsidiary’s net income be adjusted for intra-entity transfers?a. The subsidiary’s reported net income is adjusted for the impact of upstream transfers prior to computing the noncontrolling interest’s allocation.b. The subsidiary’s reported net income is adjusted for the impact of all transfers prior to computing the noncontrolling interest’s allocation.c. The subsidiary’s reported net income is not adjusted for the impact of transfers prior to computing the noncontrolling interest’s allocation.d. The subsidiary’s reported net income is adjusted for the impact of downstream transfers prior to computing the noncontrolling interest’s allocation.Appropriation for accumulated profits, if reflected in separate account, shall be shown as a. Component of equity as part of reserves b. Component of equity as part of share premium c. Component of total assets as noncurrent assets d. Component of total liabilities as current liability