The holdings on the VE Commercial Vehicles with 45,6 % and the cellcentric with 50% are classified as joint ventures within the Volvo Group. Please explain the difference between joint venture and joint operations. Is there a different accounting treatment for consolidation?

The holdings on the VE Commercial Vehicles with 45,6 % and the cellcentric with 50% are classified as joint ventures within the Volvo Group. Please explain the difference between joint venture and joint operations. Is there a different accounting treatment for consolidation?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: When we are preparing consolidated financial statements, will we have to eliminate the parent…

A: The parent company will report the investment in subsidiary as it's asset in books of accounts. But…

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

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

Q: Which of the following is correct in a Forward Triangular Merger. Cash and stock may be used as…

A: The purchasing business forms a subsidiary, which later merges with the target company, allowing the…

Q: World Enterprises is determined to report earnings per share of $2.90. It therefore acquires the…

A: Step 1: Calculation of Total EarningsThe total earnings of the merged firm are the combined earnings…

Q: The term ‘business combination’ is defined in AASB 3/IFRS 3 Business Combinations to include:…

A: Business Combination: Transactions in which one acquirer takes over another company are known as…

Q: he following does not indicate an investor company's ability to significance an investee? A.…

A: The investment in subsidiiary or another company is said to be accounted for using the equity…

Q: In many cases, EPS is computed based on the parent’s portion of consolidated net income and parent…

A: Answer:

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: The absorption of one firm by another such that the acquired firm no longer exists as a separate…

A: The question is asking for the term that describes a situation where one company absorbs another…

Q: Q1) When a company owns 50% or more of another company, accounting standards require that the owner…

A: SOLUTION- In general, the consolidation of financial statements requires a company to integrate and…

Q: Required Information [The following Information applies to the questions displayed below] Pumpworks…

A: Consolidation in accounting is the process of combining the financial statements of a parent company…

Q: Why would a company implement this upon acquisitions: "All significant intercompany transactions and…

A: Due to the growth and investing strategies of the company a company can invest into another company…

Q: Knapps Enterprises has acquired Leamington Corp. in a merger transaction. The following statements…

A: Balance sheet:The balance sheet represents a company's financial position. Hence, also known as…

Q: excel 48. Following are separate income statements for Austin, Inc., and its 80 percent-owned…

A: Earning per share is to be computed by taking the company's net income as the numerator and the…

Q: World Enterprises is determined to report earnings per share of $2.80. It therefore acquires the…

A: To determine the number of World Enterprises shares exchanged for each Wheelrim and Axle share, we…

Q: You are working on a consolidated trial balance of a parent and an 80% owned subsidiary. What…

Concept explainers

Contingent Liabilities and Provisions

A contingent liability can be defined as a liability the occurrence of which is dependent upon the happening of an uncertain future event. It is generally recorded in the books only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly.

Question

The holdings on the VE Commercial Vehicles with 45, 6% and the cellcentric with 50% are classified as
joint ventures within the Volvo Group. Please explain the difference between joint venture and joint
operations. Is there a different accounting treatment for consolidation?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Defining IFRS-11 - Joint Arrangement

VIEW

Step 2: Difference between Joint Operations and Joint Ventures

VIEW

Step 3: Different Accounting Treatment for consolidation

VIEW

Solution

VIEW

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Accounting for Current liabilities, Provisions and Contingencies

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

1. Company S and Company T combine to form a new Company ST by pooling all their assets and liabilities and issuing new ST shares to all shareholders in proportion to their previous shareholdings. How this transaction should be categorised? a) Merger b) Acquisition c) Spin-off d) De-merger
When a company owns 50% or more of another company, accounting standards require that the owner (parent) consolidates its financial statements with the subsidiary. Explain the rationale and the reasons behind that requirement
Need a long and detailed self explanatory solution for the following question What are the relative advantages and disadvantages of settings up a wholly owned subsidiary instead of a joint venture?
The following are sentences relating to types of mergers and acquisitions. Which is/are true? [S1] Both horizontal and product-extension types of M&A involve catering to the same market group before and after the M&A. [S2] A vertical M&A involves a supplier or buyer of the acting firm as the target firm.a. Only S1 is true.b. Only S2 is true.c. Neither is true.d. Both are true.
Which one of the following statements correctly applies to a merger? Multiple Choice The acquiring firm does not have to seek approval for the merger from its shareholders. The shareholders of the target firm must approve the merger. The acquiring firm will acquire the assets but not the debt of the target firm. The merged firm will have a new company name. The titles to individual assets of the target firm must be transferred into the acquiring firm's name.