MCQ Financial AccountingNon-controlling interests in a partial acquisition aremeasured at?i) Book value onlyii) Fair value or proportionate share of identifiablenet assetsiii) Costiv) Market value only

Concept of Non-Controlling Interests (NCI):Non-controlling interests represent the portion of equity…

Answered: MCQ Financial Accounting…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter10: Property, Plant And Equipment: Acquisition And Subsequent Investments

Section: Chapter Questions

Problem 12GI

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For fi nancial assets classifi ed as available for sale, how are unrealized gains and losses refl ected in shareholders’ equity? C . Th ey are a component of accumulated other comprehensive income.
Which of the following accounting methods is used to account for controlling interest investments? A. cost method B. discounted cash flow method C. consolidation method D. acquisition metho
True or False Pls indicate if the statements are True or False. 1. All allocated excess/purchase differentials are amortized. 2. Allocated excess/purchase differential amortizations are the allocation over time of the difference between the market value and the book value of the subsidiary’s assets and liabilities at the acquisition date. 3.
Which of the following statements is TRUE? a. The acquirer shall measure the identifiable assets acquired and the liabilities assumed at their acquisition-date fair value. b. Transaction costs directly related to the issue of debt instruments are deducted from the fair value of the debt on initial recognition and are amortized over the life of the debt as part of the effective interest rate. Directly attributable transaction costs incurred issuing equity instruments are deducted from revenue. c. In net asset acquisition, gain on bargain purchase is recognized in the Profit or Loss of the acquirer (after reassessment) if the consideration transferred is more than the fair value of net assets acquired. d. According to IFRS #3: Revised, cost directly attributable in effecting the business combination (e.g., finders’ fee and other direct cost) must be charged to share premium.
Explain the adjustments made in the equity method when the fair value of the net assets underlying an investment exceeds their book value at acquisition.
How 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.
S1: The acquisition-related costs in a business combination to be expensedimmediately include cost of issuing debt securities. S2: In a business combination any “gain on bargain purchase” shall be recognized in other comprehensive income. A. Only S1 is correct.B. Only S2 is correct.C. Both statements are incorrect.D. Both statements are correct.
Statement 1: If the financial asset is measured at fair value through profit or loss, transaction costs directly attributable to the acquisition are expensed immediately when incurred. Statement 2: Trading bond investments are reported at fair value. A. Only statement 1 is true B. Only statement 2 is true C. Both statements are true D. Both statements are false
In step acquisition accounting
Right Option?
The underlying equity of an investment at acquisition: Question 6Answer a. Is recorded in the investment account under the equity method b. Is equal to the book value of the investee's net assets times the percentage acquired C. Minus the cost of the investment is assigned to goodwill d. Is equal to the fair value of the investee's net assets times the percentage acquired
text __________________is the residual interest in the assets of the entity after deducting all of its liabilities a. Current Assets b. Equity c. Profit d. None of the given options

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MCQ Financial Accounting Non-controlling interests in a partial acquisition are measured at? i) Book value only ii) Fair value or proportionate share of identifiable net assets iii) Cost iv) Market value only