Exam 16: Accounting for Multiple Entities

The composition of senior management of the combined entity.All else being equal,the acquiring entity's senior management would dominate that of the combined entity.

Consolidated statements are proper for Neely,Inc. ,Randle,Inc. ,and Walker,Inc. ,if

A foreign subsidiary's function currency is its local currency that has not experienced significant inflation.The weighted average exchange rate for the current year would be the appropriate exchange rate for translating Sales to Wages expense Customers

The profitability information that should be reported for each reportable segment of a business enterprise consists of

Under the acquisition method of accounting for a business combination when the parent company has acquired only 90% of the voting stock of a subsidiary,

The noncontrolling interest in a subsidiary is reported in the consolidated balance sheet

On October 1,Company X acquired for cash all of the outstanding common stock of Company Y.Both companies have a December 31 year-end and have been in business for many years.Consolidated net income for the year ended December 31 should include net income of

The parent company concept of consolidated financial statements considers the noncontroling interest in net assets of a subsidiary to be:

Which of the following is the appropriate basis for valuing fixed assets acquired in a business combination carried out by exchanging cash for common stock?

Meredith Company and Kyle Company were combined in an acquisition transaction.Meredith was able to acquire Kyle at a bargain price.The sum of the market or appraised values of identifiable assets acquired less the fair value of liabilities assumed exceeded the cost to Meredith.After revaluing noncurrent assets to zero there was still some of the bargain purchase amount remaining formerly termed negative goodwill).Proper accounting treatment by Meredith is to report the amount as

There are severe governmentally imposed uncertainties.

U.S.GAAP requires a reporting entity to consolidate an entity in which it has a controlling financial interest.There are two primary models for assessing whether there is a controlling financial interest.Identify and discuss the accounting treatment required by each.

What are the two principles that are used to guide the preparation of consolidated financial statements?

IFRS No.10 changes the method of reporting noncontrolling interests from what was previously required in IAS No.27.How are noncontrolling interest now defined and where are they to be disclosed?

Under the acquisition method of accounting for a business combination,a bargain purchase is

The theoretically preferred method of presenting noncontrolling interest on a consolidated balance sheet is

When a parent-subsidiary relation exists,consolidated financial statements are prepared in recognition of the accounting concept of:

In financial reporting for segments of a business enterprise,the operating profit or loss of a segment should include Reasonably allocated Common Traceable Operating costs operating costs

Under the acquisition method of accounting for a business combination,restructuring costs are

Consolidated financial statements are typically prepared when one company has a controlling interest in another unless: