Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 13, Problem 27GI
To determine
Identify the accounting alternatives that are available to Incorporation M and Company P with respect to the joint venture and the manner in which it is compared with the options under U.S GAAP.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Can a foreign company and a domestic company enter into a Joint Venture? what are the requirements? Philippine laws is applicable for this question
Under the PCA, proposed mergers, acquisitions and joint ventures should satisfy the size of party test and the size of the transaction test for the merger or acquisition to be subject to compulsory notification. The size of party pertains to the computation of the aggregate value of the assets in the Philippines and revenues from sales in, into, or from the Philippines of the filing Ultimate Parent Entity (“UPE”), including all entities that it controls, directly or indirectly. Notification is compulsory if the transaction breaches the compulsory notification thresholds: the aggregate annual gross revenues in, into or from the Philippines, or value of the assets in the Philippines of the ultimate parent entity (UPE) of at least one of the acquiring or acquired entities, including that of all entities that the UPE controls, directly or indirectly, exceeds PHP6 billion (size of the party test); and the value of the transaction exceeds PHP2.4 billion (size of the transaction test). Here…
Answer the following questions on any piece of paper.1. What is a joint venture?2. Distinguish Joint venture from joint consortium and joint arrangement?3. How would you account for Joint venture?4. Can an individual enter into a joint venture with a corporation? how do you account for that?5. Distinguish partnership vs. joint venture6. Can an entity go into a joint arrangement with the government? how do you account for that?7. What is a Built Operate Transaction?8. If both big companies enter into a joint venture, will that signify unfair competition? explain briefly.9. Is there a limit to a number of corporation that can enter into a JV?10. What are the legal requirements to enter into a JV?11. Can a JV use equity method of accounting? how bout the share of net income of each individual corporation, how would you account for that?12. Can a foreign company and a domestic company enter into a JV? what are the requirements?13. How would you report in case a JV entered into by a foreign…
Chapter 13 Solutions
Intermediate Accounting: Reporting And Analysis
Ch. 13 - Prob. 1GICh. 13 - Provide brief definitions for the following terms:...Ch. 13 - What are the three categories of investments in...Ch. 13 - Prob. 4GICh. 13 - Prob. 5GICh. 13 - Identify the accounting methods a company uses for...Ch. 13 - Briefly summarize the accounting for an investment...Ch. 13 - Prob. 8GICh. 13 - Prob. 9GICh. 13 - Prob. 10GI
Ch. 13 - Prob. 11GICh. 13 - Prob. 12GICh. 13 - Prob. 13GICh. 13 - Prob. 14GICh. 13 - Prob. 15GICh. 13 - Briefly describe how to determine and record the...Ch. 13 - Prob. 17GICh. 13 - Prob. 18GICh. 13 - Prob. 19GICh. 13 - Briefly describe how to determine and record any...Ch. 13 - Prob. 21GICh. 13 - Prob. 22GICh. 13 - Prob. 23GICh. 13 - Prob. 24GICh. 13 - How does IFRS categorize minority passive...Ch. 13 - Prob. 26GICh. 13 - Prob. 27GICh. 13 - Prob. 28GICh. 13 - Prob. 29GICh. 13 - Prob. 30GICh. 13 - Prob. 31GICh. 13 - What is a fund? Distinguish between a fund and an...Ch. 13 - Prob. 33GICh. 13 - Prob. 34GICh. 13 - Prob. 1MCCh. 13 - During 2021, Anthony Company purchased debt...Ch. 13 - On July 1, 2019, Aldrich Company purchased as an...Ch. 13 - In 2021, Cromwell Corporation purchased bonds of...Ch. 13 - Prob. 5MCCh. 13 - A security in a portfolio of available-for-sale...Ch. 13 - On its December 31, 2018, balance sheet, Fay...Ch. 13 - Prob. 8MCCh. 13 - Cash dividends declared out of current earnings...Ch. 13 - On January 1, 2019, Park Company accepted a...Ch. 13 - Prob. 1RECh. 13 - Prob. 2RECh. 13 - Prob. 3RECh. 13 - Refer to the information in RE 13-3. Assume that...Ch. 13 - Prob. 5RECh. 13 - Refer to the information in RE13-5. Assume that on...Ch. 13 - Refer to the information in RE13-5. Assume that on...Ch. 13 - Prob. 8RECh. 13 - On February 1, 2019, Razorback Corporation decides...Ch. 13 - On September 30, Franz Corporation notices a...Ch. 13 - Prob. 11RECh. 13 - Refer to the information in RE13-11. Assume that...Ch. 13 - Prob. 13RECh. 13 - Prob. 14RECh. 13 - On January 1, Kilgore Inc. accepts a 20,000...Ch. 13 - Prob. 16RECh. 13 - Prob. 1ECh. 13 - Held-to-Maturity Securities and Amortization of a...Ch. 13 - Prob. 3ECh. 13 - Prob. 4ECh. 13 - Investment Discount Amortization Schedule On...Ch. 13 - Investment Premium Amortization Schedule On...Ch. 13 - Prob. 7ECh. 13 - Trading Securities At the beginning of 2019, Able...Ch. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - Available-for-Sale Securities On December 31,...Ch. 13 - Available-for-Sale Securities At the beginning of...Ch. 13 - Available-for-Sale Securities At the end of 2018,...Ch. 13 - Transfer between Categories On December 31, 2018,...Ch. 13 - Impairment On June 1, 2019, Hansen Company...Ch. 13 - Equity Securities Midwest Bank invests in equity...Ch. 13 - Equity Securities Southeast Bank invests in equity...Ch. 13 - Prob. 18ECh. 13 - Prob. 19ECh. 13 - Prob. 20ECh. 13 - Notes Receivable On January 1, 2019, Crouser...Ch. 13 - Notes Receivable On January 1, 2019, Worthylake...Ch. 13 - Note Receivable in Installments On January 1,...Ch. 13 - Notes Receivable and Income On January 1, 2019,...Ch. 13 - Prob. 25ECh. 13 - Sinking Funds Entries The following information is...Ch. 13 - (Appendix 13.1) Derivatives Anglar Company has a 3...Ch. 13 - Prob. 1PCh. 13 - Prob. 2PCh. 13 - Prob. 3PCh. 13 - Bond Investment Premium Amortization Schedule...Ch. 13 - Prob. 5PCh. 13 - Trading Securities Akers Company invests its...Ch. 13 - Investment in Trading Securities The following...Ch. 13 - Prob. 8PCh. 13 - Available-for-Sale Securities Holly Company...Ch. 13 - Investment in Available-for-Sale Bonds The...Ch. 13 - Investments in Available-for-Sale Bonds During...Ch. 13 - Equity Securities The investment manager of 4th...Ch. 13 - Equity Securities 8th State Bank prepares interim...Ch. 13 - Investments in Equity Securities Noonan...Ch. 13 - Investments in Equity Securities Manson...Ch. 13 - Prob. 16PCh. 13 - Prob. 17PCh. 13 - Prob. 18PCh. 13 - Prob. 19PCh. 13 - Equity Method and Subsequent Sale On January 1,...Ch. 13 - Prob. 21PCh. 13 - Notes Receivable On January 1, 2019, Somerville...Ch. 13 - Notes Receivable On January 1, 2019, Lisa Company...Ch. 13 - Comprehensive Notes Receivable On January 1, 2019,...Ch. 13 - Prob. 25PCh. 13 - (Appendix 13.1) Derivatives Danburg. Company has a...Ch. 13 - Realized and Unrealized Losses An important part...Ch. 13 - Investments in Securities Cane Company has two...Ch. 13 - Prob. 3CCh. 13 - Victoria Company has investments in marketable...Ch. 13 - Available-for-Sale Securities The following are...Ch. 13 - Prob. 6CCh. 13 - You are an accountant for Davanzo Company. The...Ch. 13 - Prob. 8C
Knowledge Booster
Similar questions
- What is the so-called Norwalk Agreement?a. An agreement between the FASB and SEC to allow foreign companies to use IFRS in their filing of financial statements with the SEC.b. An agreement between the U.S. FASB and the U.K. Accounting Standards Board to converge their respective accounting standards as soon as practicable.c. An agreement between the SEC chairman and the EU Internal Market commissioner to allow EU companies to list securities in the United States without providing a U.S. GAAP reconciliation.d. An agreement between the FASB and the IASB to make their existing standards compatible as soon as practicable and to work together to ensure compatibility in the future.arrow_forwardplease explain why the option is correct and remaining incorrect Under IFRS 2, with respect to choice-of-settlement share-based payments, if it is the entity that has the right to choose between equity settlement and cash settlement, when must the entity choose the cash settlement? Group of answer choices If the entity has a present obligation to settle in cash If the supplier provides goods The entity always has the option to choose either method. If the supplier provides servicesarrow_forwardExplain how a U.S. corporation could hedge net receivables in Malaysian ringgit with a forward contract. Explain how a U.S. corporation could hedge payables in Canadian dollars with a forward contract.arrow_forward
- Darwin Ltd, an Australian company, acquires a beneficial interest and becomes the Holding company of an overseas entity in New Zealand, Wellington Ltd. In which currency will Darwin Ltd report its consolidated accounts, which includes its interest in the New Zealand company, Wellington Ltd? Explain the process involvedarrow_forwardWhich of the following statements best describes the difference between a merger and joint venture? a. None of these statements provided differences the two. b. In a merger , two firms combine financial resoures to establish a new firm c. in a joint venture the bidding firm takes control o fthe control of the joint project. d. In a joint venture , firms agree to cooperate in pursuit of joint goalarrow_forwardWhich is the most simple way that is able to protect a U.S firm's earnings of its consolidated income statement in the depreciation of euro relative to U.S. dollar? A. Selling euros forward in the foreign exchange market. B. Partner with the local firm of the oversea market. C. Purchasing euros forward in the foreign exchange market. D. Establish a subsidiary in the oversea economy.arrow_forward
- Drexel Co. is a U.S.-based company that is establishing a project in a politically unstable country. It is considering two possible sources of financing. Either the parent could provide most of the financing, or the subsidiary could be supported by local loans from banks in that country. Which financing alternative is more appropriate to protect the subsidiary?arrow_forwardTo minimize exposure to political risk, a multinational firm may establish a joint venture with a local entrepreneur or a group of multinationals, or A. purchase an insurance policy from the Overseas Private Investment Corporation (OPIC). B. purchase an insurance policy from the Foreign Credit Insurance Association (FCIA). C. hedge in the Eurodollar market. D. any combination of the options.arrow_forwardQuestion What causes balance sheet (or translation) exposure to foreign exchange risk? How does balance sheet exposure compare with transaction exposure? In translating a foreign subsidiary's financial statements, what exchange rate should be used for the subsidiary's revenues and expenses? How can a parent corporation determine the functional currency for a foreign subsidiary that conducts business in more than one country? What concept underlies the temporal method of translation? What concept underlies the current rate method of translation? How does balance sheet exposure differ under these two methods? What are the major procedural differences in applying the current rate and temporal methods of translation?arrow_forward
- *ABC Corporation is a manufacturing company that recently acquired a subsidiary in a foreign country. The subsidiary's functional currency is different from the parent company's reporting currency. ABC Corporation prepares its consolidated financial statements in accordance with International Financial Reporting Standards (IFRS). Which of the following statements regarding the translation of the subsidiary's financial statements and the consolidation process is correct? A) When translating the subsidiary's financial statements from its functional currency to the parent company's reporting currency, historical exchange rates are used for all balance sheet items. B) Under IFRS, if the functional currency of the subsidiary is different from the reporting currency of the parent company, the subsidiary's financial statements must be remeasured using the reporting currency before consolidation. C) If the subsidiary's functional currency is the same as the parent company's reporting…arrow_forwardPrepare a second consolidated balance sheet for the MNE using the exchange rates you expect in the future. Determine how any reporting currency imbalance will affect the new consolidated balance sheet for the MNE. a) Prepare a transaction exposure report for Sundance and its affiliates. Determine if any transactions exposures are also translation exposures. b) Investigate what Sundance and its affiliates can do to control its transaction and translation exposures. Determine if any of the translation exposure should be hedged. Please provide excel formulas and screenshotsarrow_forwardWhich one of the following statements correctly describes a characteristic of an entity purchase agreement? A)A business entity has the obligation or option to purchase another business entity when specified events occur. B)A business interest owner has the obligation or option to sell his or her interest to a non-affiliated third party when specified events occur. C)The business entity has the obligation or option to purchase every business owner's interest when specified events occur. D)Individual owners each have the obligation to sell or offer to sell his or her interest to the other business interest owners when specified events occur.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage Learning
Business/Professional Ethics Directors/Executives...AccountingISBN:9781337485913Author:BROOKSPublisher:Cengage 
Intermediate Financial Management (MindTap Course...FinanceISBN:9781337395083Author:Eugene F. Brigham, Phillip R. DavesPublisher:Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning
Business/Professional Ethics Directors/Executives...
Accounting
ISBN:9781337485913
Author:BROOKS
Publisher:Cengage
Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning