1.

Packaging Inc. owns 18,000 shares of Enbridge Inc. On Dec 31, 2018. Enbridge's common shares = $120,000 (total outstanding shares 20,000) and retained earnings $150.000. On January 1, 2019, Packaging sold 3.600 shares from its holdings in Enbridge for $70,000. The balance in the investment in the Enbridge account was $290,000 (equity basis). Acquisition deferential was allocated as 30% to machinery (remaining life 10 yrs), 40% equipment (remaining life 5 yrs), and 30% to goodwill. Enbridge's NI for 2019 was $100,000 and paid dividends of $40,000, There was a goodwill impairment loss of $592 in 2019.

The amount of gain or loss on selling 3.600 shares on January 1, 2019. is:

$12.000 Lss

$17.800 Loss

$12.000 Gain

$17,800 Gain

2. Which of the following statements regarding the non-controlling interest is FALSE?

For the purpose of the allocation to the non-controlling interest, the financial statement of the parent is first translated into the functional currency.

When a subsidiary has foreign currency transactions and records foreign currency gains or losses, the non-controlling interest will be allocated a portion of those gains or losses since it shares in the net income of the subsidiary.

In addition to foreign currency transactions, the subsidiary may have a functional currency that is different than the parent's functional Currency:

The non-controlling interest must be allocated a portion of the comprehensive income of the group as well as a portion of the net assets of the group.

3.

The implied value of a special purpose entity (SPE) at acquisition under Canadian GAAP is equal to:

The fair value of SPE. plus the fair value of the non-controlling interest of the SPE.

The Book value of the consideration paid by the primary beneficiary to the owners of the business plus the fair value of the non controlling interest of the SPE.

The fair value of the non-controlling interest of the SPE

None of these

4.

Dividends paid to non controlling shareholders.

1. are reported as a cash outflow in the consolidated cash flow

statement.

II. represent funds that are no longer available to the consolidated III. are reported in the consolidated retained earnings statement.

entity.

Observations I and II are true.

Observation Ill alone is true

Observations I, II and III are true.

Observation I alone is true.