Matching
Select True or False for each of the following statements:
Premises:
For a mid-year acquisition following an equity method investment of the same company, the consolidated income statement will report consolidated revenues and expenses for the entire year.
A parent sells a portion of its investment in a subsidiary and no longer maintains control. This sale of shares represents a remeasurement event for the investee.
When control of a subsidiary is acquired on a date other than the first day of a fiscal year, excess amortization expenses are pro-rated to include only the post-acquisition period.
International financial reporting standards (IFRS) allow an option to value the non-controlling interest with goodwill or to value the non-controlling interest without goodwill.
Consolidated net income represents the combined net income of the parent and subsidiary after subtracting the non-controlling interest in the net income of the subsidiary.
A parent will recognize a gain or loss if it sells a portion of its investment in a subsidiary and maintains control after the sale.
When a parent has control over a subsidiary with less than 100 percent ownership, and thereafter increases its ownership, the parent remeasures the prior interest to fair value.
A)Percentage
A)Percentage
In a step acquisition where the parent previously held a non-controlling interest in the acquired firm, the parent remeasures the prior interest to fair value.
The total acquisition-date fair value of an acquired firm is the sum of the fair value of the controlling interest and the fair value of the non-controlling interest.
Responses:
True
False
Correct Answer:
Premises:
Responses:
For a mid-year acquisition following an equity method investment of the same company, the consolidated income statement will report consolidated revenues and expenses for the entire year.
A parent sells a portion of its investment in a subsidiary and no longer maintains control. This sale of shares represents a remeasurement event for the investee.
When control of a subsidiary is acquired on a date other than the first day of a fiscal year, excess amortization expenses are pro-rated to include only the post-acquisition period.
International financial reporting standards (IFRS) allow an option to value the non-controlling interest with goodwill or to value the non-controlling interest without goodwill.
Consolidated net income represents the combined net income of the parent and subsidiary after subtracting the non-controlling interest in the net income of the subsidiary.
A parent will recognize a gain or loss if it sells a portion of its investment in a subsidiary and maintains control after the sale.
When a parent has control over a subsidiary with less than 100 percent ownership, and thereafter increases its ownership, the parent remeasures the prior interest to fair value.
A)Percentage
A)Percentage
In a step acquisition where the parent previously held a non-controlling interest in the acquired firm, the parent remeasures the prior interest to fair value.
The total acquisition-date fair value of an acquired firm is the sum of the fair value of the controlling interest and the fair value of the non-controlling interest.
Premises:
For a mid-year acquisition following an equity method investment of the same company, the consolidated income statement will report consolidated revenues and expenses for the entire year.
A parent sells a portion of its investment in a subsidiary and no longer maintains control. This sale of shares represents a remeasurement event for the investee.
When control of a subsidiary is acquired on a date other than the first day of a fiscal year, excess amortization expenses are pro-rated to include only the post-acquisition period.
International financial reporting standards (IFRS) allow an option to value the non-controlling interest with goodwill or to value the non-controlling interest without goodwill.
Consolidated net income represents the combined net income of the parent and subsidiary after subtracting the non-controlling interest in the net income of the subsidiary.
A parent will recognize a gain or loss if it sells a portion of its investment in a subsidiary and maintains control after the sale.
When a parent has control over a subsidiary with less than 100 percent ownership, and thereafter increases its ownership, the parent remeasures the prior interest to fair value.
A)Percentage
A)Percentage
In a step acquisition where the parent previously held a non-controlling interest in the acquired firm, the parent remeasures the prior interest to fair value.
The total acquisition-date fair value of an acquired firm is the sum of the fair value of the controlling interest and the fair value of the non-controlling interest.
Responses:
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