Question 1

What is the total amount of sales that would appear on the Consolidated Income Statement?

Accepted Answer

A)  $816,000 
B)  $880,000 
C)  $920,000 
D) $1,000,000 
A)  $816,000 
B)  $880,000 
C)  $920,000 
D) $1,000,000 A

Question 2

Assume that the facts provided above with respect to the Jinxtor joint venture remain unchanged except that John receives $200,000 in return for investing its plant and equipment. What would be the amount of the unrealized gain?

Accepted Answer

A)  Nil 
B)  $67,500 
C)  $142,500 
D) $225,000 
A)  Nil 
B)  $67,500 
C)  $142,500 
D) $225,000 B

Question 3

Company A and B agree to engage in a joint venture. Which of the following statements pertaining to joint ventures is correct?

Accepted Answer

A)  Both parties to a joint venture must contribute an equal amount of resources to the venture. 
B)  The party contributing the most resources to the venture has control over the venture. 
C)  Both parties have joint control over the venture. 
D) All joint ventures have a stated economic useful life. 
A)  Both parties to a joint venture must contribute an equal amount of resources to the venture. 
B)  The party contributing the most resources to the venture has control over the venture. 
C)  Both parties have joint control over the venture. 
D) All joint ventures have a stated economic useful life. C

Question 4

Prepare Alcor's Balance Sheet as at December 31, 2016, if Alcor elected to report its investment in Inventure using the equity method.

Accepted Answer

Alcor Inc.
Consolida

Question 5

What is the total amount of miscellaneous assets that would appear on Seek's Consolidated Balance Sheet as at December 31, 2016?

Accepted Answer

A)  $650,000 
B)  $660,000 
C)  $840,000 
D) $900,000 
A)  $650,000 
B)  $660,000 
C)  $840,000 
D) $900,000

Question 6

Compute the consolidated net income for 2016. Do not prepare an Income Statement.
First, we must calculate the realized/unrealized inventory profits.

Accepted Answer

@#IMG-DLM& Calculati

Question 7

According to GAAP, what is the key feature of a joint arrangement?

Accepted Answer

A)  One venturer has a controlling interest in the joint arrangement. 
B)  More than one venturer has a controlling interest in the joint arrangement. 
C)  Joint control, namely, no one venturer can unilaterally control the venture regardless of the size of the equity contribution. 
D) The two largest equity contributors will have joint control over the venture. 
A)  One venturer has a controlling interest in the joint arrangement. 
B)  More than one venturer has a controlling interest in the joint arrangement. 
C)  Joint control, namely, no one venturer can unilaterally control the venture regardless of the size of the equity contribution. 
D) The two largest equity contributors will have joint control over the venture.

Question 8

Globecorp International has six operating segments, the details of which are shown below. All figures shown are in thousands of dollars.
 $\begin{array}{|l|l|l|l|}
\hline \text { Operating Segment } & \text { Rerenues } & \text { Profits } & \text { Assets } \
\hline \mathrm{A} 01 & \$ 6,000 & \$ 1,050 & \$ 12,000 \
\hline \mathrm{B} 02 & \$ 4,800 & \$ 840 & \$ 10,500 \\hline \mathrm{C} 03 & \$ 3,600 & \$ 720 & \$ 7,500 \
\hline \mathrm{D} 04 & \$ 1,800 & \$ 330 & \$ 4,500 \
\hline \mathrm{E} 05 & \$ 2,550 & \$ 405 & \$ 4,200 \
\hline \mathrm{F} 06 & \$ 900 & \$ 135 & \$ 1,800 \
\hline
\end{array}$
-Using ONLY the revenues test, determine which of the operating segments require separate disclosures.

Accepted Answer

Total revenues add up to $19,6

Question 9

What is the tax basis of these assets on January 1, 2016?

Accepted Answer

A)  $24,000 
B)  $25,200 
C)  $22,800 
D) $30,000 
A)  $24,000 
B)  $25,200 
C)  $22,800 
D) $30,000

Question 10

What is the total amount of other expenses that would appear on the Consolidated Income Statement?

Accepted Answer

A)  $200,000 
B)  $212,000 
C)  $248,000 
D) $260,000 
A)  $200,000 
B)  $212,000 
C)  $248,000 
D) $260,000

Question 11

The following balance sheets have been prepared on December 31, 2016 for Clarke Corp. and Jensen Inc.
Balance Sheets
Additional Information:
Clarke uses the cost method to account for its 50% interest in Jensen, which it acquired on January 1, 2013. On that date, Jensen's retained earnings were $20,000. The acquisition differential was fully amortized by the end of 2016.
Clarke sold Land to Jensen during 2015 and recorded a $15,000 gain on the sale. Clarke is still using this Land. Clarke's December 31, 2016 inventory contained a profit of $10,000 recorded by Jensen.
Jensen borrowed $20,000 from Clarke during 2016 interest-free. Jensen has not yet repaid any of its debt to Clarke.
Both companies are subject to a tax rate of 20%.
 $\begin{array}{|l|l|l|} 
\hline& \text { Clarke } & \text { Jensen } \
\hline & & \
\hline \text { Cash } & \$ 30,000 & \$ 20,000 \
\hline \text { Imwentory } & \$ 70,000 & \$ 30,000 \
\hline\\hline \text { Accounts Receivable } & \$ 180,000 & \$ 70,000 \
\hline \text { Imvestment in Jensen } & \$ 200,000 & \
\hline \text { Fixed Assets } & \$ 500,000 & \$ 90,000 \
\hline \text { Accumulated Depreciation } & \$ 280,000) & (\$ 30,000) \
\hline \text { Total Assets } & \$ 700,000 & \$ \mathbf{1 8 0 , 0 0 0} \\hline \text { Current Liabilities } & \$ 120,000 & \$ 60,000 \
\hline \text { Long-Term Debt } & \$ 400,000 & \$ 20,000 \
\hline \text { Common Shares } & \$ 90,000 & \$ 40,000 \
\hline \text { Retained Earnings } & \$ 90,000 & \$ 60,000 \
\hline \text { Liabifities and Equity } & \$ 700,000 & \$ 180,000 \
\hline
\end{array}$
-Prepare a Balance Sheet for Clarke on December 31, 2016 in accordance with current Canadian GAAP, assuming that Clarke's investment in Jensen is a significant influence investment and is reported using the equity method.

Accepted Answer

Clarke Inc,
Balance

Question 12

Under which accounting standards is the reporting of the liabilities of operating segments required?

Accepted Answer

A)  It is required under US GAAP. 
B)  It is required under ASPE. 
C)  It is required under IFRS. 
D) It is required under IFRS only when this information is reported to the organization's chief operating decision maker. 
A)  It is required under US GAAP. 
B)  It is required under ASPE. 
C)  It is required under IFRS. 
D) It is required under IFRS only when this information is reported to the organization's chief operating decision maker.

Question 13

The following balance sheets have been prepared on December 31, 2016 for Clarke Corp. and Jensen Inc.
Balance Sheets
Additional Information:
Clarke uses the cost method to account for its 50% interest in Jensen, which it acquired on January 1, 2013. On that date, Jensen's retained earnings were $20,000. The acquisition differential was fully amortized by the end of 2016.
Clarke sold Land to Jensen during 2015 and recorded a $15,000 gain on the sale. Clarke is still using this Land. Clarke's December 31, 2016 inventory contained a profit of $10,000 recorded by Jensen.
Jensen borrowed $20,000 from Clarke during 2016 interest-free. Jensen has not yet repaid any of its debt to Clarke.
Both companies are subject to a tax rate of 20%.
 $\begin{array}{|l|l|l|} 
\hline& \text { Clarke } & \text { Jensen } \
\hline & & \
\hline \text { Cash } & \$ 30,000 & \$ 20,000 \
\hline \text { Imwentory } & \$ 70,000 & \$ 30,000 \
\hline\\hline \text { Accounts Receivable } & \$ 180,000 & \$ 70,000 \
\hline \text { Imvestment in Jensen } & \$ 200,000 & \
\hline \text { Fixed Assets } & \$ 500,000 & \$ 90,000 \
\hline \text { Accumulated Depreciation } & \$ 280,000) & (\$ 30,000) \
\hline \text { Total Assets } & \$ 700,000 & \$ \mathbf{1 8 0 , 0 0 0} \\hline \text { Current Liabilities } & \$ 120,000 & \$ 60,000 \
\hline \text { Long-Term Debt } & \$ 400,000 & \$ 20,000 \
\hline \text { Common Shares } & \$ 90,000 & \$ 40,000 \
\hline \text { Retained Earnings } & \$ 90,000 & \$ 60,000 \
\hline \text { Liabifities and Equity } & \$ 700,000 & \$ 180,000 \
\hline
\end{array}$
-Prepare a Consolidated Balance Sheet for Clarke on December 31, 2016 assuming that Clarke's investment in Jensen is a control investment.

Accepted Answer

Clarke Inc,
Consolid

Question 14

What is the amount of miscellaneous liabilities that would appear on Seek's December 31, 2016 Consolidated Balance Sheet?

Accepted Answer

A)  $166,000 
B)  $176,000 
C)  $230,000 
D) $240,000 
A)  $166,000 
B)  $176,000 
C)  $230,000 
D) $240,000

Question 15

What is the amount of the Deferred Tax Asset or Liability on December 31, 2017?

Accepted Answer

A)  a Deferred Tax Liability of $1,350 
B)  a Deferred Tax Liability of $375 
C)  a Deferred Tax Asset of $1,350 
D) a Deferred Tax Asset of $1,675 
A)  a Deferred Tax Liability of $1,350 
B)  a Deferred Tax Liability of $375 
C)  a Deferred Tax Asset of $1,350 
D) a Deferred Tax Asset of $1,675

Question 16

At what amount would John record its initial investment in Jinxtor?

Accepted Answer

A)  $240,000 
B)  $500,000 
C)  $740,000 
D) $800,000 
A)  $240,000 
B)  $500,000 
C)  $740,000 
D) $800,000

Question 17

What is the amount of Consolidated Retained Earnings at December 31, 2016?

Accepted Answer

A)  $340,000 
B)  $368,000 
C)  $376,000 
D) $546,200 
A)  $340,000 
B)  $368,000 
C)  $376,000 
D) $546,200

Question 18

What is the amount of the amortization of the unrealized gain for 2016 arising from the transfer of John's assets?

Accepted Answer

A)  Nil 
B)  $18,000 
C)  $42,000 
D) $60,000 
A)  Nil 
B)  $18,000 
C)  $42,000 
D) $60,000

Question 19

What is the amount of Consolidated Net Income for 2016?

Accepted Answer

A)  $206,200 
B)  $208,000 
C)  $216,000 
D) $218,000 
A)  $206,200 
B)  $208,000 
C)  $216,000 
D) $218,000

Question 20

What is the total amount of cost of sales that would appear on the Consolidated Income Statement?

Accepted Answer

A)  $396,000 
B)  $399,000 
C)  $420,000 
D) $500,000 
A)  $396,000 
B)  $399,000 
C)  $420,000 
D) $500,000

What is the total amount of sales that would appear on the Consolidated Income Statement?

Assume that the facts provided above with respect to the Jinxtor joint venture remain unchanged except that John receives $200,000 in return for investing its plant and equipment. What would be the amount of the unrealized gain?

Company A and B agree to engage in a joint venture. Which of the following statements pertaining to joint ventures is correct?

Prepare Alcor's Balance Sheet as at December 31, 2016, if Alcor elected to report its investment in Inventure using the equity method.

What is the total amount of miscellaneous assets that would appear on Seek's Consolidated Balance Sheet as at December 31, 2016?

Compute the consolidated net income for 2016. Do not prepare an Income Statement. First, we must calculate the realized/unrealized inventory profits.

According to GAAP, what is the key feature of a joint arrangement?

What is the tax basis of these assets on January 1, 2016?

What is the total amount of other expenses that would appear on the Consolidated Income Statement?

Under which accounting standards is the reporting of the liabilities of operating segments required?

What is the amount of miscellaneous liabilities that would appear on Seek's December 31, 2016 Consolidated Balance Sheet?

What is the amount of the Deferred Tax Asset or Liability on December 31, 2017?

At what amount would John record its initial investment in Jinxtor?

What is the amount of Consolidated Retained Earnings at December 31, 2016?

What is the amount of the amortization of the unrealized gain for 2016 arising from the transfer of John's assets?

What is the amount of Consolidated Net Income for 2016?

What is the total amount of cost of sales that would appear on the Consolidated Income Statement?

Conceptual and Case Analysis Frameworks for Financial Reporting

Investments in Equity Securities

Business Combinations

Consolidation of Non-Wholly Owned Subsidiaries

Consolidation Subsequent to Acquisition Date

Intercompany Inventory and Land Profits

A Intercompany Profits in Depreciable Assets B Intercompany Bondholdings

Consolidated Cash Flows and Changes in Ownership

Foreign Currency Transactions

Translation and Consolidation of Foreign Operations

Accounting for Not-For-Profit and Public Sector Organizations

Filters

Exam 9: Other Consolidation Reporting Issues

What is the total amount of sales that would appear on the Consolidated Income Statement?

Assume that the facts provided above with respect to the Jinxtor joint venture remain unchanged except that John receives $200,000 in return for investing its plant and equipment. What would be the amount of the unrealized gain?

Company A and B agree to engage in a joint venture. Which of the following statements pertaining to joint ventures is correct?

Prepare Alcor's Balance Sheet as at December 31, 2016, if Alcor elected to report its investment in Inventure using the equity method.

What is the total amount of miscellaneous assets that would appear on Seek's Consolidated Balance Sheet as at December 31, 2016?

Compute the consolidated net income for 2016. Do not prepare an Income Statement. First, we must calculate the realized/unrealized inventory profits.

According to GAAP, what is the key feature of a joint arrangement?

What is the tax basis of these assets on January 1, 2016?

What is the total amount of other expenses that would appear on the Consolidated Income Statement?

Under which accounting standards is the reporting of the liabilities of operating segments required?

What is the amount of miscellaneous liabilities that would appear on Seek's December 31, 2016 Consolidated Balance Sheet?

What is the amount of the Deferred Tax Asset or Liability on December 31, 2017?

At what amount would John record its initial investment in Jinxtor?

What is the amount of Consolidated Retained Earnings at December 31, 2016?

What is the amount of the amortization of the unrealized gain for 2016 arising from the transfer of John's assets?

What is the amount of Consolidated Net Income for 2016?

What is the total amount of cost of sales that would appear on the Consolidated Income Statement?

Conceptual and Case Analysis Frameworks for Financial Reporting

Investments in Equity Securities

Business Combinations

Consolidation of Non-Wholly Owned Subsidiaries

Consolidation Subsequent to Acquisition Date

Intercompany Inventory and Land Profits

A Intercompany Profits in Depreciable Assets B Intercompany Bondholdings

Consolidated Cash Flows and Changes in Ownership

Foreign Currency Transactions

Translation and Consolidation of Foreign Operations

Accounting for Not-For-Profit and Public Sector Organizations

Filters