The adjusting entries for unrealised profit arisen from trading of goods between parent and wholly owned subsidiary. give the journal : If the seller is parent If the seller is subsidiary
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The
parent and wholly owned subsidiary.
give the journal :
| If the seller is parent |
| If the seller is subsidiary |
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- Gain on Bargain Purchase treated as other income in a business combination should be: a. Credited to the income account of both acquirer and acquire b. Credited to the share premium account of the acquirer c. Credited to a deferred credit account d. Credited to the income account of the acquirerProfits on sale of inventories between Parent and Subsidiary Companies is when goods are held still as inventories Select one: O a. Recognized O b. Deferred O C. Amortized O d. RealizedUnder the cost method, dividends from the subsidiary to the parent Ⓡ a. are recognized in income when received. b. are recognized in income when declared. c. are recognized in income when paid. Od. do not affect income. Save Answer
- In the cost method of acquisition income is recognized only when the subsidiary declares dividends Select one: True FalseThe unamortized excess account is a. the excess purchase cost that is attributable to goodwill. b. the excess purchase cost that is attributable to a bargain purchase. c. the excess purchase cost over the subsidiary’s net assets’ book value d. the excess purchase cost over the subsidiary’s net assets’ fair value.Which of the following statements about post-acquisition earnings is incorrect? А. They are the earnings produced subsequent to the acquisition date by members of the group. В. They form part of earnings of the economic entity. С. They are eliminated against the parent's earnings, in a similar fashion to pre- acquisition earnings. D. They form part of earnings of the economic entity and they are eliminated against the parent's earnings, in a similar fashion to pre-acquisition earnings.
- Which of the following is not considered in the determination of Total Assets after business combination? Group of answer choices a.Book value of the acquirer’s total assets. b.Fair value of the acquiree’s total assets. c.Expenses that are actually paid in relation to business combination d.Contingent considerationIn accordance with PFRS 2, Share-based Payment, how should an entity recognize the change in fair value of the liability in respect of a cash-settled share-based payment transaction? Group of answer choices Do not recognize in the financial statements but disclose in the notes thereto. Recognize in other comprehensive income. Recognize in the statement of changes in entity. Recognize in profit or loss.How is the investor’s share of gross profit on intra-entity sales calculated? Under the equity method, how does the deferral of gross profit affect the recognition of equity income?
- How should negative goodwill be shown on the consolidated financial statements of the acquirer? Group of answer choices As a liability on the statement of financial position As a loss on the statement of comprehensive income As a separate amount under shareholders' equity on the statement of financial position As a gain on the statement of comprehensive incomeHow shall an acquirer in a business combination account for the changes in fair value contingent consideration classified as equity instrument if the changes result from events after the acquisition date? a. The changes in fair value of contingent consideration classified as equity shall be recognized as gain or loss in profit or loss because they are not measurement period adjustments. b. Contingent consideration classified as equity shall not be re-measured and its subsequent settlement shall be accounted for within equity. c. The changes in fair value of contingent consideration classified as equity shell be retrospectively restated to beginning retained earnings because they are prior period error. d. The change in fair value of contingent consideration classified as equity shall be retroactively adjusted to goodwill/gain on bargain purchase because they are measurement period adjustments.1) Merchandise invested by an entity under a joint operation agreement should include an entry of a)Debit to Joint Operation under the books of the Joint Operators other than the party who invested b)Credit to merchandise inventory of the Joint Operator who contributed merchandise c)Credit to merchandise Inventory of all the Joint Operators d)Credit to Joint Operation under the books of the party investing the merchandise 2) The interest of the retiring or withdrawing partner is usually measured by his capital balance before his retirement or withdrawal adjusted by the following adjustments except a)profit or loss after the date of the partner’s withdrawal or retirement b)changes in the valuation of all assets and liabilities c)errors in net income in prior years d)profit or loss from the operation from the last closing date of the date of his retirement or withdrawal 3)In case of admission of a partner, the first adjustment that need to be prepared is a) The…
