ADVANCED FINANCIAL ACCOUNTING IA
12th Edition
ISBN: 9781260545081
Author: Christensen
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 3, Problem 3.19.1P
To determine
Introduction:
Consolidation is the process of accounting where books of the parent company are reported along with the books of the subsidiary company in consolidated/combined form after making necessary
To choose: The correct option.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Which of the following statements is incorrect concerning the preparation of consolidated financial statements? *
A. Consolidated financial statem ents shall be prepared using uniform accounting policies for like transactions and other events in similar circumstances.
b. The financial statements of the parent and its subsidiaries shall be consolidated on a line by line basis by adding together like items of assets, liabilities, equity, income and expenses.
c. Intragroup balances, transactions, income and expenses shall be eliminated in full.
d. When the reporting dates of the parent and a subsidiary are different, the difference shall be no more than six months.
Describe the presentation of the consolidated balance sheet and income statement indicatinga) The inclusion of goodwill and gain on acquisitionb) Disclosures necessary to the financial statements.c) The impairment of goodwill.
(Mention any topics / subtopics from the FASB codification if used)
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 year
Chapter 3 Solutions
ADVANCED FINANCIAL ACCOUNTING IA
Ch. 3 - What is the basic idea underlying the preparation...Ch. 3 - How might consolidated statements help an investor...Ch. 3 - Prob. 3.3QCh. 3 - Prob. 3.4QCh. 3 - Prob. 3.5QCh. 3 - Prob. 3.6QCh. 3 - Prob. 3.7QCh. 3 - Prob. 3.8QCh. 3 - Prob. 3.9QCh. 3 - Prob. 3.10Q
Ch. 3 - Prob. 3.11QCh. 3 - Prob. 3.12QCh. 3 - What is meant by indirect control? Give an...Ch. 3 - Prob. 3.14QCh. 3 - Prob. 3.15QCh. 3 - Prob. 3.16QCh. 3 - Prob. 3.17QCh. 3 - Prob. 3.18QCh. 3 - Prob. 3.1CCh. 3 - Prob. 3.2CCh. 3 - Prob. 3.1.1ECh. 3 - Prob. 3.1.2ECh. 3 - Prob. 3.1.3ECh. 3 - Prob. 3.1.4ECh. 3 - Multiple-Choice Question on Variable Interest...Ch. 3 - Multiple-Choice Question on Variable Interest...Ch. 3 - Prob. 3.2.3ECh. 3 - Prob. 3.2.4ECh. 3 - Prob. 3.3.1ECh. 3 - Prob. 3.3.2ECh. 3 - Prob. 3.3.3ECh. 3 - Prob. 3.4.1ECh. 3 - Prob. 3.4.2ECh. 3 - Prob. 3.4.3ECh. 3 - Prob. 3.4.4ECh. 3 - Balance Sheet Consolidation On January 1, 20X3,...Ch. 3 - Prob. 3.6ECh. 3 - Prob. 3.7ECh. 3 - Prob. 3.8ECh. 3 - Prob. 3.9ECh. 3 - Reporting for a Variable Interest Entity Gamble...Ch. 3 - Prob. 3.11ECh. 3 - Prob. 3.12ECh. 3 - Prob. 3.13ECh. 3 - Prob. 3.14ECh. 3 - Prob. 3.15ECh. 3 - Prob. 3.16ECh. 3 - Prob. 3.17ECh. 3 - Prob. 3.18ECh. 3 - Prob. 3.19.1PCh. 3 - Prob. 3.19.2PCh. 3 - Prob. 3.20PCh. 3 - Prob. 3.21PCh. 3 - Prob. 3.22PCh. 3 - Prob. 3.23PCh. 3 - Prob. 3.24PCh. 3 - Prob. 3.25PCh. 3 - Prob. 3.26PCh. 3 - Prob. 3.27PCh. 3 - Prob. 3.28PCh. 3 - Prob. 3.29PCh. 3 - Consolidated Worksheet at End of the First Year of...Ch. 3 - Prob. 3.31P
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Statement 1: The preparation of consolidated financial statements after acquisition is materially different concept from preparing them in the acquisition date in the sense that reciprocal accounts are eliminated and remaining balances are combined. Statement 2: All revenues and expenses of individual consolidating companies arising from transactions and actions with affiliated companies are included in the consolidated financial statements. a. Only Statement 1 is correct b. Both statements are correct c. Only Statement 2 is correct d. Both statements are incorrectarrow_forwardHi please assistarrow_forwardWhen a contingent consideration arising from a business combination is classified as equity, how is any change in its fair value accounted for if the difference arises due to a change in circumstances? Multiple Choice As a memorandum entry indicating that additional shares hed been isued, As an edjustment to an estimate included in the determination of net income. As an adjustment to consolidated contributed surplus. As an adiustment to the consideration naid for the subsidiarvarrow_forward
- Choose the letter of the item NOT belonging or related to the group in computing for Non-Controlling Interest in the Consolidated Statement of Financial Position. * a. Answer not given b. full goodwill. c. amortization of excess. d. upstream transactions. e. gain on bargain purchase.arrow_forwardWhich consolidation method should be used in preparing consolidated financial statements in accordance with IFRS? A. Proportionate consolidation method.B. Either identifiable net assets or fair value enterprise method.C. New entity method.D. Parent company method.arrow_forwardWhich of the following statements is TRUE? O The acquirer shall measure the identifiable assets acquired and the liabilities assumed at their acquisition-date fair value. O According to IFRS #3: Revised, cost directly attributable in effecting the business combination (e.g., finders' fee and other direct cost) must be charged to share premium. Transaction costs directly related to the issue of debt instruments are deducted from the fair value of the debt on initial recognition and are amortized over the life of the debt as part of the effective interest rate. Directly attributable transaction costs incurred issuing equity instruments are deducted from revenue. In net asset acquisition, gain on bargain purchase is recognized in the Profit or Loss of the acquirer (after reassessment) if the consideration transferred is more than the fair value of net assets acquired.arrow_forward
- In response to the board’s second question, Templeton should reply that if the changeis made, the consolidated fi nancial statements for Consolidated Motors would begin torecognize:A . realized gains and losses on monetary assets and liabilities.B . realized gains and losses on non-monetary assets and liabilities.C . unrealized gains and losses on non-monetary assets and liabilities.arrow_forwardUnder 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.arrow_forwardWhat is the answer to these question I uploadedarrow_forward
- In accordance with PAS 1, which of the following gains or losses from reclassification of financial assets need not be presented separately in the profit or loss section or the statement of profit or loss? A.None of these. B. Reclassification of financial assets out of the FVTOCI measurement category to FVTPL C. Reclassification of financial assets out of the FVTPL measurement category. D.Reclassification of financial assets out of the amortized cost measurement category to FVTPLarrow_forwardWhich statement about US GAAP and IFRS accounting standards is true? O US GAAP requires that assets be divided up into current and non-current assets while IFRS does not require such division. O Both US GAAP and IFRS require that owners' equity be listed after liabilities. O US GAAP will generally list assets and liabilities in order from most liquid to least liquid while IFRS will generally do the opposite. Both US GAAP and IFRS require that non-current liabilities be listed before current liabilities.arrow_forwardChoose the letter that corresponds to the answers.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Auditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage Learning
Auditing: A Risk Based-Approach to Conducting a Q...AccountingISBN:9781305080577Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:South-Western College Pub
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning
Auditing: A Risk Based-Approach to Conducting a Q...
Accounting
ISBN:9781305080577
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:South-Western College Pub