Soft Bound Version for Advanced Accounting 13th Edition
13th Edition
ISBN: 9781260110579
Author: Hoyle
Publisher: McGraw Hill Education
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Chapter 4, Problem 5P
To determine
Identify the appropriate answer for the given statement from the given choices.
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Answer with true or false.
1. The non-controlling interest is presented in the statement of financial position as an asset.
2. Foreign subsidiaries need not be consolidated in preparing the consolidated financial statements if they are reported as a separate operating group under segment reporting.
3. Consolidated financial statements is needed if the investor has significant influence over the investee company.
How is non-controlling interest in the subsidiary’s net assets presented in the consolidated statement of financial position?
a. Within equity but separately from the equity of the owners of the parents.
b. Within equity as part of retained earnings.
c. Any of these as a matter of accounting policy choice.
d. As a mezzanine item between liabilities and equity.
Which of the following accounting treatments for costs related to business combination is incorrect?
Group of answer choices
The costs related to issuance of financial liability at fair value through profit or loss shall be recognized as expense while those related to issuance of financial liability at amortized cost shall be recognized as deduction from the book value of financial liability or treated as discount on financial liability to be amortized using effective interest method.
The costs related to issuance of stock or equity securities shall be deducted/debited from any share premium from the issue and any excess is charged to “share issuance cost” reported as contract-equity account against either (1) share premium from other share issuances or (2) retained earnings
Acquisition related costs such as finder’s fees; advisory, legal, accounting, valuation and other professional and consulting fees; and general administrative costs, including the costs of maintain an…
Chapter 4 Solutions
Soft Bound Version for Advanced Accounting 13th Edition
Ch. 4 - Prob. 1QCh. 4 - Atwater Company acquires 80 percent of the...Ch. 4 - What is a control premium and how does it affect...Ch. 4 - Prob. 4QCh. 4 - How is the noncontrolling interest in a subsidiary...Ch. 4 - Prob. 6QCh. 4 - Prob. 7QCh. 4 - Prob. 8QCh. 4 - Prob. 9QCh. 4 - Prob. 10Q
Ch. 4 - Prob. 1PCh. 4 - Prob. 2PCh. 4 - Prob. 3PCh. 4 - Prob. 4PCh. 4 - Prob. 5PCh. 4 - Prob. 6PCh. 4 - Prob. 7PCh. 4 - Assuming that Pride, in its internal records,...Ch. 4 - Prob. 9PCh. 4 - Prob. 10PCh. 4 - Prob. 11PCh. 4 - Prob. 12PCh. 4 - Prob. 13PCh. 4 - Prob. 14PCh. 4 - Prob. 15PCh. 4 - Prob. 16PCh. 4 - Prob. 17PCh. 4 - Prob. 18PCh. 4 - Current liabilities: a. 50,000 b. 46,000 c. 40,000...Ch. 4 - Prob. 20PCh. 4 - Stockholders equity: a. 80,000 b. 90,000 c. 95,000...Ch. 4 - Prob. 22PCh. 4 - Prob. 23PCh. 4 - Prob. 24PCh. 4 - Prob. 25PCh. 4 - Prob. 26PCh. 4 - Prob. 27PCh. 4 - Prob. 28PCh. 4 - Prob. 29PCh. 4 - Prob. 30PCh. 4 - Prob. 31PCh. 4 - Prob. 32PCh. 4 - Prob. 33PCh. 4 - Prob. 34PCh. 4 - Prob. 35PCh. 4 - Prob. 36PCh. 4 - Prob. 37PCh. 4 - Prob. 38PCh. 4 - Prob. 39PCh. 4 - Prob. 40PCh. 4 - Prob. 41PCh. 4 - Prob. 42PCh. 4 - Prob. 43PCh. 4 - Prob. 44PCh. 4 - Prob. 1DYSCh. 4 - Prob. 2DYSCh. 4 - Costco Wholesale Corporation owns and operates...
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- Which of the following are considered separate financial statements? a. Those presented by a parent in addition to the consolidated financial statements, in compliance with a regulatory requirement. b. Those presented by an entity, which does not have a subsidiary or associate and is not a venturer in jointly controlled entity. c. Those presented by an entity which does not have any equity interest in another entity. d. Financial statements of an entity that applies the equity method.arrow_forwardIn every corporate liquidation, which type of credits will not share from the free assets of the corporation? * a. Unsecured claims without priority b. Partially secured claims c. Fully secured claims d. Unsecured claims with priorityarrow_forwardConsolidated financial statements are required in which ofthe following situations?a. Only when a company can exert significant influenceover another company.b. Only when a company has a passive investment inanother company.c. Only when a parent company can exercise control overits subsidiary.d. None of the above.arrow_forward
- 1. PAS 28 defines an ‘associate’ as Choices An entity that controls one or more entities. An entity over which the investor has significant influence. A joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement. An entity that is controlled by another entity. 2. 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? Choices None of these. Reclassification of financial assets out of the FVTOCI measurement category to FVTPL. Reclassification of financial assets out of the amortized cost measurement category to FVTPL. Reclassification of financial assets out of the FVTPL measurement category.arrow_forwardAnswer with true or false. No need explanation. 1. Indirect cost incurred by the entity in business combination is recognized as expense. 2. PFRS 10 defines control as the power to govern the financial and operating policies as to obtain benefits from its activities. 3. An investor has no power over the investee even if the investor holds the majority of the voting rights if those rights are not substantive. 4. A subsidiary should be excluded from the consolidated statements if the subsidiary operates under governmentally impose uncertainty.arrow_forwardWhich of the following regarding the preparation of Consolidated Financial Statement iscorrect?A. Once the parent company prepares Consolidated Financial Statements, it no longerneeds to prepare financial statements for its own activities.B. Only the subsidiaries are required to prepare Financial Statements.C. Consolidated Financial Statements are required by the Parent Company for reportingpurposes only; each company must continue to prepare its own FinancialStatements.D. Consolidated Financial Statements are required only when both companies arepublicly traded.arrow_forward
- The FASB ASC paragraph 810-10-45-16 states: “The noncontrolling interest shall be reported in the consolidated statement of financial position within equity, separately from the parent’s equity. That amount shall be clearly identified and labeled, for example, as noncontrolling interest in subsidiaries.” However, prior to issuing this current reporting requirement, the FASB considered several alternative display formats for the noncontrolling interest. Access the precodification standard, SFAS 160, “Noncontrolling Interest in Consolidated Financial Statements,” at www.fasb.org to answer the following: 1. What alternative financial statement display formats did the FASB consider for the noncon- trolling interest? 2. What criteria did the FASB use to evaluate the desirability of each alternative? 3. In what specific ways did FASB Concept Statement 6 affect the FASB’s evaluation of these alternatives?arrow_forwardWhich 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.arrow_forward10. According to IFRS, a parent company need not prepare group accounts if:A. The parent company is itself a wholly-owned subsidiary B. The parent company’s shares are not publicly traded.C. The parent's ultimate parent company presents group accountsD. All of the aboveE. None of the abovearrow_forward
- 1. According to PAS 1, a currently maturing debt that the entity'smanagement intends to refinance is presented as noncurrent.2. According to PFRS 15, if an entity expects that a portion of giftcertificates sold will not be redeemed, the entity recognizes theexpected breakage amount as revenue in proportion to the pattern of rights exercised by customers.3. Unearned revenue is revenue that is earned but not yet collected Please answer these 3 question true or falsearrow_forwarde. How would your answers to items (b) through (d) change if the Legal Entity is a "voting interest entity?" Consolidated net income $ Consolidated net income attributable to noncontrolling interest $ Consolidated net income attributable to controlling interest $ 0 0 0arrow_forwardWhich of the following is NOT a required disclosure for any entity that holds an interest in a VIE? a.The significant judgments and assumptions made by an enterprise in determining whether it must consolidate a VIE and/or disclose information about its involvement in a VIE b.How the entity's involvement involvement with the VIE is perceived by Wall Street analysts c.The nature of restrictions on a consolidated VIE’s assets and on the settlement of its liabilities reported by an enterprise in its statement of financial position, including the carrying amounts of such assets and liabilities. d. The nature of, and changes in, the risks associated with an enterprise’s involvement with the viearrow_forward
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