If a business combination occurs and the consideration paid exceeds the fair value of the identifiable net assets of the subsidiary on the acquisition date and the parent acquires less than 100% of the outstanding common shares of the subsidiary, which consolidation method will result in the highest value for non-controlling interest on the acquisition date? Proportionate consolidation method Parent company method Fair value enterprise method Identifiable net assets method

Q: A parent company owns 80% of the issued capital of its subsidiary. On consolidation, a sale of…

A: Lets understand the basics. When there is transaction between the parent entity and subsidiary…

Q: Calculate the goodwill on consolidation from the information below: Parent’s cost of investment in…

A: Goodwill is an intangible asset which may be purchased or self-generated. It also arises when the…

Q: In a business combination resulting in a parent-subsidiary relationship, the identifiable net assets…

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

Q: Where the parent firm does not own 100% of the subsidiary company, how much of the parent entity's…

A: At the time of the consolidation the intra-group transactions needs to be eliminated. Because, if…

Q: tatement 1: Consolidated inventory on the statement of financial position is recorded at fair market…

A: Intercompany transactions are the transactions incur between the parent and subsidiary company…

Q: A parent acquires the outstanding bonds of a subsidiary company directly from an outside third…

A: Describe whether the gain should be allocated to the parent or the subsidiary: The gain of $45,000…

Q: Where the parent company does not hold 100 percent equity of the subsidiary company, what portion of…

A: The parent company is the company that holds more than 50% of the affairs of the subsidiary company

Q: Which statement is true regarding consolidation when there is a noncontrolling interest?…

A: When a company is holding shares of a company of more than 50% of outstanding share . Then the…

Q: What method must be used if FASB 94 prohibits full consolidation of a 70% owned subsidiary?

A: FASB 94 - This Statement amends ARB No. 51, Consolidated Financial Statements, to require…

Q: What share of the intra-group transactions between the parent entity and the subsidiary entity will…

A: Crucial IdeasCONSOLIDATED FINANCIAL STATEMENTS PRIMARY CONCEPTS HOLDING COMPANY: is a term used to…

Q: Starting from the separate inventory balances of the affiliates, the consolidated inventory balance…

A: At the time of consolidation, inventory is recorded at the fair value so any difference in the fair…

Q: ecorded in the applicable asset and liability accounts of the parent

A: Business combination refers to a transaction in which the acquirer has complete control over the…

Q: Consolidation at date of acquisition (purchase price equals book value) A parent company acquires…

A: The acquisition takes place whenever the company buys the shares or take over which is the purchase…

Q: S1: In a business combination resulting in a parent company-wholly owned subsidiary relationship,…

A: In a business combination, goodwill arises from paying extra consideration over the net identifiable…

Q: In a share acquisition business combination resulting in a parent- subsidiary relationship, the…

A: When one company acquires the substantial shares in other company, then first company is known as…

Q: a parent company acquires a less-than-100 percent controlling interest in a subsidiary, what portion…

A: Controlling interest in a subsidiary refers to acquiring between 50% to less than 100% of the…

Q: Statement 1: In a business combination resulting a parent company-wholly owned subsidiary…

A: Consolidated financial statements are the financial statements of a group consisting of multiple…

Q: Starting from the separate inventory balances of the affiliates, the consolidated inventory balance…

A: Starting from the separate inventory balances of the affiliates, the consolidated inventory balance…

Q: S1: In a business combination resulting a parent company-wholly owned subsidiary relationship,…

A: An investor as well as investee of the business combinations, which usually involves an acquisition…

Q: Use the following facts for Multiple Choice problems 18-20. Each of the problems is independent of…

A: A company can report the earnings it makes from its investment in another business using the equity…

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.