Question 1

Preference shares of a subsidiary not owned by the parent company will be included as part of the NCI.

Accepted Answer

A) True 
 B)False

Question 2

The effect of all intra group transactions must be adjusted in calculating the NCI share of subsidiary profits.

Accepted Answer

A) True 
 B)False

Question 3

A subsidiary's recorded profits and retained earnings must be adjusted for unrealised profits prior to calculation of NCI allocation.The adjustments apply to:

Accepted Answer

A)  upstream transactions 
B)  downstream transactions 
C)  both upstream and downstream transactions 
D)  none of the above 
A)  upstream transactions 
B)  downstream transactions 
C)  both upstream and downstream transactions 
D)  none of the above

Question 4

If A owns 80% of B and B owns 75% of C,A's ownership interest in B and C is characterised as direct.

Accepted Answer

A) True 
 B)False

Question 5

Discuss the effect of intra group transactions on the calculation of the NCI share of subsidiary profits and retained earnings

Accepted Answer

Effect of intra group transactions on NC

Question 6

The fair value method of measuring NCI includes an amount representing the non controlling shareholder's interest in goodwill.

Accepted Answer

A) True 
 B)False

Question 7

The ownership interests in a group which includes partly owned subsidiaries consist of:

Accepted Answer

A)  the parent entity shareholders 
B)  the 'outside' subsidiary entity shareholders 
C)  both the parent entity and the 'outside' subsidiary entity shareholders 
D)  none of the above 
A)  the parent entity shareholders 
B)  the 'outside' subsidiary entity shareholders 
C)  both the parent entity and the 'outside' subsidiary entity shareholders 
D)  none of the above

Question 8

P Ltd purchased 80% of the issued ordinary shares of S Ltd.S Ltd capital structure is: Ordinary shares 200,000 fully paid shares x $1
Preference shares 50,000 fully paid shares x $1
Preference shares have the same rights as ordinary shares
The NCI in S Ltd is:

Accepted Answer

A)  20% 
B)  16% 
C)  36% 
D)  none of the above 
A)  20% 
B)  16% 
C)  36% 
D)  none of the above

Question 9

Accounting Standard AASB3 Business combinations allows the choice of measuring NCI using either the fair value method or the proportionate interest method.

Accepted Answer

A) True 
 B)False

Question 10

Unrealised intra-group profit in opening inventory of a parent company is:

Accepted Answer

A)  added to subsidiary profit in calculating NCI share of profit 
B)  subtracted from subsidiary profit in calculating NCI share of profit 
C)  ignored in calculating NCI share of profit 
D)  none of the above 
A)  added to subsidiary profit in calculating NCI share of profit 
B)  subtracted from subsidiary profit in calculating NCI share of profit 
C)  ignored in calculating NCI share of profit 
D)  none of the above

Question 11

The disclosure of non controlling interest proportion of each equity balance in the consolidated financial statements provides useful information on:

Accepted Answer

A)  dividend payment capacity 
B)  business activity results 
C)  Segment activity results 
D)  all the above 
A)  dividend payment capacity 
B)  business activity results 
C)  Segment activity results 
D)  all the above

Question 12

Is the proprietary concept of consolidation is consistent with the proportional consolidation method?

Accepted Answer

Proprietary concept of consolidation:
-

Question 13

-Using the proportionate interest goodwill method,goodwill on acquisition is:

Accepted Answer

A)  $92,000 
B)  $12,000 
C)  $36,000 
D)  none of the above 
A)  $92,000 
B)  $12,000 
C)  $36,000 
D)  none of the above

Question 14

The measurement of the NCI allocation will be based on the subsidiary company's equity account balances.

Accepted Answer

A) True 
 B)False

Question 15

When an investment in a subsidiary is impaired,any impairment losses will be:

Accepted Answer

A)  apportioned between PI and NCI 
B)  borne by the PI 
C)  ignored 
D)  none of the above 
A)  apportioned between PI and NCI 
B)  borne by the PI 
C)  ignored 
D)  none of the above

Question 16

Company A owns 40% of Company B and this ownership is deemed to represent control.The non controlling interest in B is:

Accepted Answer

A)  40% 
B)  60% 
C)  100% 
D)  No non controlling interest 
A)  40% 
B)  60% 
C)  100% 
D)  No non controlling interest

Question 17

In preparing a consolidated financial report,the parent entity consolidates:

Accepted Answer

A)  The financial statements of all entities over which it has the power to exercise control. 
B)  The financial statements of only those entities over which it has the power to control and in which it holds more than 50% of the voting shares. 
C)  The financial statements of only those entities in which it holds more than 50% of the ordinary share capital; as a result of which it necessarily has the power to exercise control. 
D)  None of the above. 
A)  The financial statements of all entities over which it has the power to exercise control. 
B)  The financial statements of only those entities over which it has the power to control and in which it holds more than 50% of the voting shares. 
C)  The financial statements of only those entities in which it holds more than 50% of the ordinary share capital; as a result of which it necessarily has the power to exercise control. 
D)  None of the above.

Preference shares of a subsidiary not owned by the parent company will be included as part of the NCI.

The effect of all intra group transactions must be adjusted in calculating the NCI share of subsidiary profits.

A subsidiary's recorded profits and retained earnings must be adjusted for unrealised profits prior to calculation of NCI allocation.The adjustments apply to:

If A owns 80% of B and B owns 75% of C,A's ownership interest in B and C is characterised as direct.

Discuss the effect of intra group transactions on the calculation of the NCI share of subsidiary profits and retained earnings

The fair value method of measuring NCI includes an amount representing the non controlling shareholder's interest in goodwill.

The ownership interests in a group which includes partly owned subsidiaries consist of:

P Ltd purchased 80% of the issued ordinary shares of S Ltd.S Ltd capital structure is: Ordinary shares 200,000 fully paid shares x $1 Preference shares 50,000 fully paid shares x $1 Preference shares have the same rights as ordinary shares The NCI in S Ltd is:

Accounting Standard AASB3 Business combinations allows the choice of measuring NCI using either the fair value method or the proportionate interest method.

Unrealised intra-group profit in opening inventory of a parent company is:

The disclosure of non controlling interest proportion of each equity balance in the consolidated financial statements provides useful information on:

Is the proprietary concept of consolidation is consistent with the proportional consolidation method?

-Using the proportionate interest goodwill method,goodwill on acquisition is:

The measurement of the NCI allocation will be based on the subsidiary company's equity account balances.

When an investment in a subsidiary is impaired,any impairment losses will be:

Company A owns 40% of Company B and this ownership is deemed to represent control.The non controlling interest in B is:

In preparing a consolidated financial report,the parent entity consolidates:

Text Objectives and Introduction to Consolidation

Principles of Consolidation

Fair Value Adjustments and Tax Effects

Intra-Group Transactions

Partly-Owned Subsidiaries: Indirect Non-Controlling Interest

Consolidated Cash Flow Statements

Accounting for Joint Arrangements

Accounting for Associates and Joint Ventures: the Equity Method

Translation and Consolidation of Foreign Currency Financial Statements

Segment Reporting by Diversified Entities

Filters

Exam 5: Non-Controlling Interest

Preference shares of a subsidiary not owned by the parent company will be included as part of the NCI.

The effect of all intra group transactions must be adjusted in calculating the NCI share of subsidiary profits.

A subsidiary's recorded profits and retained earnings must be adjusted for unrealised profits prior to calculation of NCI allocation.The adjustments apply to:

If A owns 80% of B and B owns 75% of C,A's ownership interest in B and C is characterised as direct.

Discuss the effect of intra group transactions on the calculation of the NCI share of subsidiary profits and retained earnings

The fair value method of measuring NCI includes an amount representing the non controlling shareholder's interest in goodwill.

The ownership interests in a group which includes partly owned subsidiaries consist of:

P Ltd purchased 80% of the issued ordinary shares of S Ltd.S Ltd capital structure is: Ordinary shares 200,000 fully paid shares x $1 Preference shares 50,000 fully paid shares x $1 Preference shares have the same rights as ordinary shares The NCI in S Ltd is:

Accounting Standard AASB3 Business combinations allows the choice of measuring NCI using either the fair value method or the proportionate interest method.

Unrealised intra-group profit in opening inventory of a parent company is:

The disclosure of non controlling interest proportion of each equity balance in the consolidated financial statements provides useful information on:

Is the proprietary concept of consolidation is consistent with the proportional consolidation method?

-Using the proportionate interest goodwill method,goodwill on acquisition is:

The measurement of the NCI allocation will be based on the subsidiary company's equity account balances.

When an investment in a subsidiary is impaired,any impairment losses will be:

Company A owns 40% of Company B and this ownership is deemed to represent control.The non controlling interest in B is:

In preparing a consolidated financial report,the parent entity consolidates:

Text Objectives and Introduction to Consolidation

Principles of Consolidation

Fair Value Adjustments and Tax Effects

Intra-Group Transactions

Partly-Owned Subsidiaries: Indirect Non-Controlling Interest

Consolidated Cash Flow Statements

Accounting for Joint Arrangements

Accounting for Associates and Joint Ventures: the Equity Method

Translation and Consolidation of Foreign Currency Financial Statements

Segment Reporting by Diversified Entities

Filters