Exam 4: Consolidated Statements on Date of Acquisition

The following data pertains to Questions Keen and Lax Inc had the following balance sheets on October 31,2007: -Assuming that Keen Inc.purchases 80% of Lax Inc.for $240,000,prepare the Consolidated Balance Sheet on the Date of Acquisition.

Consolidated financial statements consist of

Under the Proprietary theory,Non-Controlling Interest is

Using Push Down accounting is:

The following data pertains to Questions Keen and Lax Inc had the following balance sheets on October 31,2007: -Assuming that Keen Inc.purchases 80% of Lax Inc.for $240,000,prepare any journal entries you feel are necessary on the date of acquisition prior to the preparation of Consolidated Financial Statements.Assume that the Entity Method applies.

There are a number of theories of how financial statements should be prepared for non-wholly owned subsidiaries.Briefly discuss each theory and provide your reasoning to support the theory that is being adopted under IFRSs.

One weakness associated with the Entity Theory is that

On the date of formation of a 100% owned subsidiary by the parent:

The following data pertains to questions Parent and Sub Inc had the following balance sheets on July 31,2007: The Net Incomes for Parent and Sub Inc for the year ended July 31,2007 were $120,000 and $60,000 respectively. -Assuming that Parent Company purchased 80% of Sub Inc.for $180,000,the Liabilities section (including Non-Controlling Interest)of Parent's Consolidated Balance Sheet on the date of acquisition would total what amount under current GAAP?

A company owning a majority (but less than 100%)of another's voting shares on the date of acquisition should account for its subsidiary

Non-Controlling Interest is presented in the Shareholders' Equity section of the Balance Sheet under:

The following data pertains to questions Parent and Sub Inc had the following balance sheets on July 31,2007: The Net Incomes for Parent and Sub Inc for the year ended July 31,2007 were $120,000 and $60,000 respectively. -Assuming Parent purchased 80% of Sub Inc.for $180,000;the Assets section of Parent's Consolidated Balance Sheet on the date of acquisition would total what amount under current GAAP?