15 ion If a parent company borrows money at an interest rate of six percent from its subsidiary, what effect (if any) will this have on the non-controlling interest? This would have no effect on the non-controlling interest. The subsidiary would book its pro-rata share of any interest revenue. The non-controlling interest balance would be reduced by the amount of the loan. The subsidiary would record any interest revenue as an extraordinary gain.

Q: What is the purpose of EDI?

A: Transparency in electronic data exchange: Expanding EDI enables suppliers to get access to a buyer's…

Q: Explain IO and PO Strips?

A: Interest only (IO) strips are a financial product shaped by unraveling the principal and interest…

Q: briefly explain what is meant by breakven points

A: Cost accounting is the part of accounting that helps in determining the total cost of production. It…

Q: Explain the features of HELOCs that differentiate them from HELs with example?

A: Home equity refers to the difference in the value of the home and the mortgage balance. In HELs and…

Q: Which of the following is true of structured data? Select answer from the options below Structured…

A: The objective of the question is to identify the correct statement about structured data from the…

Q: Which ways can a decision tree be presented to help lay out the sequence of decisions that can be…

A: Graphical representation:- In this format, nodes and branches are used to visually represent the…

Q: What formula is being used if not using excel?

A: The concept of the time value of money determines that the worth of money gets depreciated over a…

Q: Explain an example of faithful representation.

A:

Q: Define management by exception.

A: Management by exceptions: Management by exceptions determines that the managers should not focus if…

Q: How does the Representational faithfulness is enhanced if information is free from error?

A: Accounting:   Accounting is the process of recording the financial transaction of the organization…

Q: Name two different ways that MPTBs can be overcollateralized

A: The MPTBs are viewed as hybrid securities. Such bonds have qualities of mortgage backed bond (MBB)…

Q: Define Double-entry system.

A: Double entry system: Double entry system is a way of accounting or bookkeeping which implies that…

Q: How can forwardrates be used for hedging purposes?

A: SOLUTION:- Risk management is the main stimulus for forward contracts. Forward contract is a…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.