Advanced Financial Accounting
12th Edition
ISBN: 9781259916977
Author: Christensen, Theodore E., COTTRELL, David M., Budd, Cassy
Publisher: Mcgraw-hill Education,
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Question
Chapter 9, Problem 9.2Q
To determine
Concept Introduction:
A company issues stock in two basic forms, common stock and
To indicate:The reporting of non controlling interest of subsidiary’s preferred stock in consolidation.
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Which of the following statements is correct regarding working paper entries to facilitate the preparation of the consolidated financial statements? *
A. Debit Non-controlling Interest in Net Assets in the working paper to assign to the non-controlling stockholders their share in the gain on bargain purchase.
b. Debit Share Premium relating to issuance of stocks in the working paper to record the cost of SEC registration and listing fees.
c. Credit Investment in Subsidiary Company Stock in the working paper to record the purchase of outstanding shares from subsidiary company.
d. Credit Equipment in the working paper to adjust a fair value differential of an overvalued equipment.
How is the noncontrolling interest treated in the consolidated balance sheet?
a.
It is included in long-term liabilities.
b.
It appears between the liability and equity sections of the balance sheet.
c.
It is included in total as a component of shareholders’ equity.
d.
It is included in shareholders’ equity and broken down into par, paid-in capital in excess of par and retained earnings.
How is the Non-Controlling Interest displayed in a consolidated balance sheet?
a. As a separate item in the stockholder’s equity section
b. By means of a note to consolidated financial statements
c. As a separate item between the liabilities and stockholder’s equity
d. As a deduction from goodwill, if any
e. Non-controlling interest is never presented in consolidated balance sheet.
Chapter 9 Solutions
Advanced Financial Accounting
Ch. 9 - Prob. 9.1QCh. 9 - Prob. 9.2QCh. 9 - Prob. 9.3QCh. 9 - Prob. 9.4QCh. 9 - Prob. 9.5QCh. 9 - Prob. 9.6QCh. 9 - Prob. 9.7QCh. 9 - Prob. 9.8QCh. 9 - Prob. 9.9QCh. 9 - Prob. 9.10Q
Ch. 9 - Prob. 9.11QCh. 9 - Prob. 9.12QCh. 9 - Prob. 9.13QCh. 9 - Prob. 9.14QCh. 9 - Prob. 9.15QCh. 9 - Prob. 9.16QCh. 9 - Prob. 9.1CCh. 9 - Prob. 9.2CCh. 9 - Prob. 9.3CCh. 9 - Prob. 9.4CCh. 9 - Prob. 9.5CCh. 9 - Prob. 9.1.1ECh. 9 - Prob. 9.1.2ECh. 9 - Prob. 9.1.3ECh. 9 - Prob. 9.1.4ECh. 9 - Prob. 9.2.1ECh. 9 - Prob. 9.2.2ECh. 9 - Prob. 9.2.3ECh. 9 - Prob. 9.2.4ECh. 9 - Prob. 9.2.5ECh. 9 - Prob. 9.3ECh. 9 - Prob. 9.4ECh. 9 - Prob. 9.5ECh. 9 - Prob. 9.6ECh. 9 - Prob. 9.7ECh. 9 - Prob. 9.8ECh. 9 - Prob. 9.9ECh. 9 - Prob. 9.10ECh. 9 - Prob. 9.11ECh. 9 - Subsidiary Stock Dividend Stake Company reported...Ch. 9 - Prob. 9.13ECh. 9 - Prob. 9.14ECh. 9 - Prob. 9.15ECh. 9 - Prob. 9.16ECh. 9 - Prob. 9.17.1PCh. 9 - Prob. 9.17.2PCh. 9 - Prob. 9.17.3PCh. 9 - Prob. 9.17.4PCh. 9 - Prob. 9.17.5PCh. 9 - Prob. 9.18PCh. 9 - Prob. 9.19PCh. 9 - Prob. 9.20PCh. 9 - Prob. 9.21PCh. 9 - Prob. 9.22PCh. 9 - Prob. 9.23PCh. 9 - Prob. 9.24PCh. 9 - Prob. 9.25PCh. 9 - Prob. 9.26PCh. 9 - Prob. 9.27P
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- Which statement is incorrect? * A. EPS disclosures are required for entities whose ordinary shares are publicly traded as well as entities that are in the process of issuing ordinary shares in the public market. B. When an entity issues both consolidated ad separate financial statements, the EPS information is required for the consolidated financial statements only. C. In computing basic EPS, the amount of preference dividends on noncumulative preference shares for the period should be deducted from net income whether declared or not D. In computing the weighted average of shares outstanding, when a share dividend or share split occurs, the additional shares are considered outstanding at the beginning of the earliest year reported. E. none of the abovearrow_forwardWhich of the following does not affect accumulated profits? A. Stock dividendB. Share splitC. Conversion of preference share to ordinary shareD. Treasury share transactionarrow_forwardWhich of the following statements is true in relation to the call price of preference shares? The call price is used in computing book value per share. In the absence of call price, the liquidation value is disregarded and the par or stated value is instead used. The call price is the amount paid to preference shareholders upon redemption of preference shares during the lifetime of the entity. All of these statements are true.arrow_forward
- What is advantges and dis advantge of shares repurchacse to the company?arrow_forwardWhat portion of the balances of subsidiary stockholders' equity accounts are eliminated in preparing the consolidated balance sheet? Select one: a. Retained Earnings only b. Common stock only c. Additional paid-in capital only d. All of the balances are eliminatedarrow_forwardExplain how convertible securities are determined to bepotentially dilutive common shares and how thoseconvertible securities that are not considered to be potentiallydilutive common shares enter into the determinationof earnings per share data.arrow_forward
- Question: How do you account for non-controlling interests in consolidated financial statements using the equity method?arrow_forwardWhen a small, share capital dividend is declared, Retained Earnings is debited for the a. par value of the share capitalb. fair market value of the share capital on the date of recordc. fair market value of the share capital on the date of declarationd. fair market value of the share capital on the date of distributionarrow_forwardWhich statement is incorrect? a. PAS 33 is required to be used by companies whose shares and potential shares are publicly traded. b. When an undertaking presents both consolidated and separate financial statements, the disclosures required by PAS 33 need be presented only for the consolidated information c. Basic EPS amounts uses the profit attributable to ordinary equity holders of the parent undertaking. d. Basic EPS shall be calculated by dividing the numerator by the weighted-average number of ordinary shares during the period e. none of the abovearrow_forward
- Which statement is incorrect? * a. PAS 33 is required to be used by companies whose shares and potential shares are publicly traded. b. When an undertaking presents both consolidated and separate financial statements, the disclosures required by PAS 33 need be presented only for the consolidated information c. Basic EPS amounts uses the profit attributable to ordinary equity holders of the parent undertaking. d. Basic EPS shall be calculated by dividing the numerator by the weighted-average number of ordinary shares during the period none of the abovearrow_forwardTransaction costs incurred by the corporation relating to issue of shares may not be a. Charged against the related share premium b. Charged to an expense account c. Written off directly against share capital d. Taken to profit or lossarrow_forwardWhich statement is incorrect? * PAS 33 is required to be used by companies whose shares and potential shares are publicly traded. When an undertaking presents both consolidated and separate financial statements, the disclosures required by PAS 33 need be presented only for the consolidated information Basic EPS amounts uses the profit attributable to ordinary equity holders of the parent undertaking. Basic EPS shall be calculated by dividing the numerator by the weighted-average number of ordinary shares during the period none of the abovearrow_forward
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