Commerce and Business
BusinessFinancial AccountingFinancial Accounting and Reporting An International ApproachPractice Set 2490
BusinessFinancial AccountingFinancial Accounting and Reporting An International ApproachPractice Set 2490Further Consolidation Issues Iii: Accounting For Indirect Ownership Interest
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- An Overview of the International External Reporting EnvironmentThe Conceptual Framework of Accounting and Its Relevance to Financial ReportingTheories of Financial AccountingAn Overview of Accounting for AssetsDepreciation of Property, Plant and EquipmentRevaluations and Impairment Testing of Non-Current AssetsInventoryAccounting for IntangiblesAn Overview of Accounting for LiabilitiesAccounting for LeasesShare Capital, Reserves and Share Options Employee Bonus SchemesAccounting for Financial InstrumentsRevenue Recognition IssuesThe Statement of Comprehensive Income and Statement of Changes in EquityAccounting for Income TaxesThe Statement of Cash FlowsEvents Occurring After the Reporting DateRelated-Party DisclosuresEarnings Per ShareFurther Consolidation Issues I: Accounting for Intragroup TransactionsFurther Consolidation Issues II: Accounting for Non-Controlling InterestsFurther Consolidation Issues III: Accounting for Indirect Ownership InterestAccounting for Foreign Currency TransactionsTranslating the Financial Statements of Foreign OperationsAccounting for Corporate Social Responsibility
Question 1
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True/False
The non-controlling interest in post-acquisition movement in reserves and post-acquisition profits is based on the combined sum of both direct non-controlling interest and indirect non-controlling interest.
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True
False
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Question 2
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True/False
The non-controlling interest in post-acquisition capital and reserves will be based on direct non-controlling interest.
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True
False
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Question 3
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True/False
Non-controlling indirect interests are entitled to receive dividends in a subsidiary.
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True
False
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Question 4
Free
True/False
The elimination of the parent entity's investment in a subsidiary will be done by eliminating the investment against the parent entity's direct and indirect ownership interest in pre-acquisition share capital and reserves.
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True
False
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Question 5
Free
True/False
An ultimate parent entity may obtain a controlling indirect interest in another entity as a result of holding a controlling interest in the immediate parent entity of that other entity.
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True
False
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Question 6
True/False
A Plc owns 60 per cent of the issued capital of B Plc,B Plc owns 80 per cent of the issued capital of C Plc,and B Plc owns 70 per cent of the issued capital of D Plc.The ultimate parent entity is B Plc.
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True
False
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Question 7
True/False
It is not possible for one entity to control another entity without any direct ownership interest.
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True
False
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Question 8
True/False
In calculating indirect non-controlling interests,intragroup transactions need not be eliminated.
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True
False
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Question 9
True/False
When a parent acquires its interest in an intermediate subsidiary after the intermediate subsidiary acquires an interest its own subsidiary,this is referred to as a non-sequential acquisition.
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True
False
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Question 10
True/False
It is possible for aggregated direct and indirect non-controlling interests in an entity to be a greater percentage of ownership than the parent's aggregated direct and indirect ownership interests.
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True
False
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Question 11
True/False
Control means the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
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True
False
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Question 12
Multiple Choice
A Plc owns 60% of the issued capital of B Plc and B Plc owns 55% of the issued capital of C Plc.What is A's interest in C Plc?
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55%
24%
30%
33%
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Question 13
Multiple Choice
A Plc owns 80% of the issued capital of B Plc and B Plc owns 60% of the issued capital of C Plc.What is A's interest in C Plc?
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32%
48%
60%
16%
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Question 14
Multiple Choice
A Plc owns 75% of the issued capital of B Plc and B Plc owns 65% of the issued capital of C Plc.What is the total outside equity interest in C Plc?
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48.75%
35%
25.75%
51.25%
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Question 15
Multiple Choice
A Plc owns 85% of the issued capital of B Plc and B Plc owns 90% of the issued capital of C Plc.What is the total outside equity interest in C Plc?
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23.5%
10%
13.5%
15%
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Question 16
Multiple Choice
The following diagram represents the ownership of issued share capital of the companies in a group.What is the ownership interest of A Ltd in D Ltd? 
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50%
96.5%
68%
80%
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Question 17
Multiple Choice
The following diagram represents the ownership of issued share capital of the companies in a group.What is the ownership interest of A Ltd in D Ltd? 
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83.4%
76.6%
100%
86%
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Question 18
Multiple Choice
The following diagram represents the ownership of issued share capital of the companies in a group.What is the total outside equity interest in D Ltd? 
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14%
10%
30%
22%
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Question 19
Multiple Choice
The following diagram represents the ownership of issued share capital of the companies in a group.What is the total outside equity interest in D Ltd? 
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20%
33.6%
60%
24.8%
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Question 20
Multiple Choice
Rose Ltd acquired a 75 per cent interest in Daisy Ltd on 1 July 2014 for a cash consideration of €758 000.On the same date,Daisy Ltd acquired a 56 per cent interest in Tulip Ltd for a cash consideration of €534 000.The fair value of the net assets of each of the companies at acquisition is as follows: 
Goodwill has been determined not to have been impaired.Using the multiple entity consolidation approach,what would the analysis of direct and indirect interests in the subsidiaries and the elimination entries be for the consolidation for 30 June 2015?
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