Answered: A controlling financial interest…

A controlling financial interest traditionally has been defined as the investor corporation's ownership of more than 50% of the investee corporation's outstanding common stock Select one: True False

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter21: Corporations: Taxes, Earnings, Distributions, And The Statement Of Retained Earnings

Section: Chapter Questions

Problem 1MC

See similar textbooks

Related questions

Q: True or False: If Company Accumulates Common Stock in Company B such that it acquires a 51% stake…

A: Consolidated financial statements - Consolidated financial statements will contain the financials of…

Q: t the date of financial statements, ordinary shares issued would exceed ordinary shares outstanding…

A: Solution Note Dear student as per the Q&A guideline we are required to answer the first question…

Q: share dividend on its share capital

A: Upon issue of share dividend, retained earnings is debited with issue price, common stock is…

Q: When a corporation has only one class of share capital, book value per share is computed as…

A: The ratio analysis helps to analyse the financial statements of the business.

Q: of the following statements pertain to dividends. Which of them is (are) true? a. Shareholders vote…

A: The dividend is declared to the shareholders from the retained earnings of the business.

Q: Equity securities acquired by a corporation which are accounted for by reporting unrealized holding…

A: Profits or losses that have occurred on paper but have not yet been realized are referred to as…

Q: Shareholders wealth is calculated as Select one: a. Number of shareholders X Current market price b.…

A: Shareholder's wealth is collective wealth created by the company and represented by its market…

Q: In general, consolidated financial statements should be prepared: O whenever the market value of the…

A: Financial statements of a company having many divisions or subsidiaries are called consolidated…

Q: Identify which category of shareholder's equity is affected by the item and briefly explain how it…

A: Statement of stockholders’ equity refers to a financial statement which shows the shares issued to…

Q: Ownership of shares of share capital entitles the holders to all of the following rights, except:…

A: >The ownership of the corporations are in the hands of number of stockholders. >The holder of…

Q: ‘An associate is an entity over which the investor has significant influence’ (para 3). Which of…

A: AN ASSOCIATE IS AN ENTITY OVER WHICH AN INVESTOR HAS SIGNIFICANT INFLUENCE , BEING ABLE TO…

Q: The pre-emptive right of common shareholders is defined as the right: a. to receive cash dividends…

A: Common shareholder's are true owner's of the company. These shareholder's is entitled to vote in…

Q: 30. The par value of ordinary share capital represents a. the liquidation value of the share…

A: >The corporations get their finance mainly from the issuance of share capital.>The share…

Q: If a company owns 25% of the voting stock of Pink Co. and can exercise significant influence,…

A: Significant influence equity investments:Significant influence equity investments are the…

Q: The par value of a share capital is * O The legal nominal value assigned to the share O The amount…

A: Share means a ita an financial instrument that a Company used for their Fund arrangements from the…

Q: The par value of ordinary share represents The liquidation value of the share •The book value of the…

A: As posted multiple independent questions we are answering only first question kindly repost the…

Q: Discuss the accounting treatment, if any, that should be given to each of the following items in…

A: Earnings per share EPS is an essential financial metric, which aims to evaluate the profitability of…

Q: In applying the Sec. 318 attribution rules to a stock redemption, the stock of a corporation is only…

A: Sec 318 of US code is related with constructive ownership of stock. Under this section, an…

Q: What is the Effective Annual Rate (EAR) and what is its purpose?

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: The par value of common stock represents a. the estimated fair value of the stock when it was…

A: The correct answer is Option (a).

Q: A rights offering provides existing stockholders the opportunity to purchase shares of new issues to…

A: Stockholders are the owners of the company

Q: Discuss the accounting treatment, if any, that should be given to each of the following items in…

A: “Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Identify which category of shareholder's equity is affected by each item and briefly explain how it

A: Shareholders equity is one of the important element of balance sheet of the business. It shows total…

Q: The par value of ordinary share capital represents a. The amount received by the corporation when…

A: Par value of the share = Equity share capital/ No of outstanding shares Par value is the nominal…

Q: The right of a shareholder to share proportionally in any new stock issue is called a/an…

A: Shares are the units of stock of a corporation that are issued in the financial markets. A…

Q: A. Shareholders N. Outstanding shares O. Legal capital P. Eleemosynary corporation Q. Quasi – Public…

A: The corporation is the basic type of choice for doing the business. The one who wants to expand the…

Q: Of two corporations organized at approximately the same time and engaged in competing businesses,one…

A: Common stock: These are the ordinary shares that a corporation issues to the investors in order to…

Q: Why it is called that if a company acquires more than 50% of the voting stock of another company,…

A: Corporation: A corporation is a form of business entity that is incorporated through the state…

Q: When an investor owns between 20% and 50% of outstanding stock of another company and has…

A: When an investor owns between 20% and 50% of outstanding stock of another company and has…

Q: An associate is an entity in which an investor has significant influence over the investee. Which…

A: As per the provision contained in IAS 28 Investment in associates Associates define as an entity in…

Q: Based on the presumption in IAS 27, the cost method is applied for equity securities when the…

A: Based on the presumption in IAS 27, the cost method is applied for equity securities when the…

Q: Market value per share is: Multiple Choice The right of common stockholders to protect their…

A: Equity shares are the investments that provide the buyer with ownership of the company. These are…

Q: Par value of a stock refers to the ________. Dividend to be paid by the corporation Issue price of…

A: Stock represent the share of ownership of an investor or shareholder in an entity, stock is like a…

Q: Treasury shares, Interest, Dividends, Losses and Gains 4. Which of the following statement is…

A: PAS 32:-This standard deals in the presentation of financial instruments particularly classified as…

Q: When an investor owns 20% to 50% of the voting stock of an investee company, the investor is…

A: When an investor owns 20% to 50% of the voting stock of an investee company, the investor is…

Q: Share options granted by a corporation are recorded as expense on the number of options that a…

A: Solution Note : dear student as per the Q&A guideline we are required to answer the first…

Q: Equity securities acquired by a corporation which are accounted for by recognizing unrealized…

A: When some investments are made in some other company or corporation, then it depends on the quantum…

Question

A controlling financial interest traditionally has been
defined as the investor corporation's ownership of
more than 50% of the investee corporation's
outstanding common stock
Select one:
True
False

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

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

rdinary share capitalOrdinary share capitalWhich of the following items would not form part of the shareholders' equity of a company on the statement of financial position? Select one: a. Retained profits b. Trade payables c. Share premium d. Ordinary share capital
The par value of ordinary share capital represents a. The amount received by the corporation when the share was originally issued. b. The book value of the share capital c. The liquidation value of the share capital d. The legal nominal value assigned to the share capital
Significant influence is normally presumed to exist if the investor owns at least a certain percentage of the investeecompany's ordinary shares. This percentage is_____.Select one:a.10%b.50%c.51%d.20%
Share options granted by a corporation are recorded as expense on the number of options that a are initially granted. b are vested. c are eventually exercised. d are expected to be exercised. Non-market based performance conditions include vesting based on achieving all of the following except a achieving a specific growth in revenue b achieving a specific growth in net profit c achieving a specific increase in EPS d achieving a specific target share price Statement 1: Share options granted that vest base on performance condition to the key employees of the business wherein they need to achieve an increase in the share price will recognize fully the compensation expense over the vesting period regardless the condition is met or not.Statement 2: Share options that are granted without fair value on the grant date will recognize compensation expense within the vesting period only. a True,False b False, True c True, true dFalse, false
Equity securities acquired by a corporation which are accounted for by recognizing unrealized holding gains or losses as part of the net income are: Securities where a company has holdings of between 20% and 50% Securities where a company has holding of less than 20% O Available-for-sale securities where a company has holdings of less than 20% O Securities where a company has holdings of more than 50%
A company’s publicly listed shares: a. Can be traded on any share market around the world b. Represent an ownership claim on the company’s real assets (net of liabilities) c. Are guaranteed to provide a dividend cash-flow d. All of the above e. None of the above
Which of the following correctly indicates how the issue price of common stock shares would be valued when a corporation makes a follow-on issue? Market forces determine the selling price, as it is marketed by the selling group The highest expected issue price per share that can be obtained while still selling of all of the shares is selected The highest expected issue price per share that can be obtained, regardless of the selling group's ability to market the shares, is selected The market price of existing shares is used as guidance
1. Identify the most acceptable value of share capital in exchange of non-cash asset. options •Fair market value of share issued •Fair market value of non-cash asset received •Par value of share capital issued. •Carrying value of the non-cash asset received. 2. Which of the following is included in the equity section of a corporate business? •Investment in equity shares •Treasury shares •Subscription Receivable – current •Unearned revenue
All below are Preferred Share features EXCEPT ________________ A. A type of stock that provide a fixed dividend, but at the discretion of the Board of Directors. B. Preferred stock ranks below the debt but above common stock. C. Has ownership of the company. D. All of the above.
1. The cost method of accounting for stock investments is used when the company acquires a. Greater than 50% of the company's stock b. Between 20% to 50% of the company's stock c. Less than 20% of the company's stock 2. The significance of percentage of ownership relates to how much _____________ the acquiring company has in the new company. a. data b. control c. confidence
Gain on sale of treasury shares should be credited to: * A. Share Premium from treasury shares B. Accumulated profits C. Share capital D. None of the above
Par value of a stock refers to the ________. Dividend to be paid by the corporation Issue price of a stock Value assigned by the incorporation documents Maximum selling price of a stock