Question 1

All of the following are acceptable methods to account for a majority-owned investment in subsidiary except

Accepted Answer

A)  The equity method. 
B)  The initial value method. 
C)  The partial equity method. 
D)  The fair-value method. 
E)  Book value method. 
A)  The equity method. 
B)  The initial value method. 
C)  The partial equity method. 
D)  The fair-value method. 
E)  Book value method.

Question 2

Harrison, Inc. acquires 100% of the voting stock of Rhine Company on January 1, 2010 for $400,000 cash. A contingent payment of $16,500 will be paid on April 15, 2011 if Rhine generates cash flows from operations of $27,000 or more in the next year. Harrison estimates that there is a 20% probability that Rhine will generate at least $27,000 next year, and uses an interest rate of 5% to incorporate the time value of money. The fair value of $16,500 at 5%, using a probability weighted approach, is $3,142.
When recording consideration transferred for the acquisition of Rhine on January 1, 2010, Harrison will record a contingent performance obligation in the amount of:

Accepted Answer

A)  $628.40 
B)  $2,671.60 
C)  $3,142.00 
D)  $13,358.00 
E)  $16,500.00 
A)  $628.40 
B)  $2,671.60 
C)  $3,142.00 
D)  $13,358.00 
E)  $16,500.00

All of the following are acceptable methods to account for a majority-owned investment in subsidiary except

The Equity Method of Accounting for Investments

Consolidation of Financial Information

Consolidated Financial Statements and Outside Ownership

Consolidated Financial Statementsintra-Entity Asset Transactions

Variable Interest Entities, Intra-Entity Debt, Consolidated Cash Flows, and Other Issues

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Partnerships: Formation and Operation

Partnerships: Termination and Liquidation

Accounting for State and Local Governments Part 1

Accounting for State and Local Governments Part 2

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Exam 3: Consolidationssubsequent to the Date of Acquisition

All of the following are acceptable methods to account for a majority-owned investment in subsidiary except

The Equity Method of Accounting for Investments

Consolidation of Financial Information

Consolidated Financial Statements and Outside Ownership

Consolidated Financial Statementsintra-Entity Asset Transactions

Variable Interest Entities, Intra-Entity Debt, Consolidated Cash Flows, and Other Issues

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Partnerships: Formation and Operation

Partnerships: Termination and Liquidation

Accounting for State and Local Governments Part 1

Accounting for State and Local Governments Part 2

Filters