accounting for its investment. which it accounts for using the equity as not paid any dividends. Small has lost a total of $100 million. What 5. nig invested $10 "illion in small 5 years ago, and bought a 25% interest Big uses the ance should Big show for its investment in Small? a S10 million b. Zero bal c. Negative S15 million d. Negative $25 million has Parent acquires Child on January 1, 2018. Child is not dissolved. Each company date, which intangible assets amortization. In a intangible assets, which are on their books at historical cost, minus consolidated balance sheet was prepared at the acquisition shown at their book values, ignoring fair value at the acquisition date? a. Only Parent's b. Only Child's c. Both Parent's and Child's d. Neither Parent's nor Child's 7. hu Uinder the acquisition method of accounting,the costs of legal and aecounting fee by the acquirer are treated as: a. Deferred assets, that are not amortized. b. Reductions in paid-in capital c. Expenses of the period d. Part of the consideration for the acquisition, and used as part of the computation of goodwill Which of the following is the best explanation of the idea of "control" under FASB 8. standards? Control exists when one company has the direct or indirect ability to determine the a. direction of management and policies of another company b. Control, for accounting purpose s, is always based on share ownership, and does not look at contracts or other rights ONLY a company that owns over 50% of another company i control ONLY a company that owns over 80% of another company is ever considered to have control Which of the following characteristics is not indicative of an enterprise qualifying as c. ever considered to have d. 9. a primary beneficiary with a controlling financial interest in a variable interest entity? a. The right to receive potentially significant benefits of the entity b. The power to direct the most significant economic performance activities. c. The obligation to absorb potentially significant losses of the entity. d. No ability to make decisions about the entity's activities. 10. Large buys 100% of the stock of Tiny for $400 million. On that date, Tiny owned various identifiable assets and liabilities with a net fair value of $420 million. The consolidated financial statements at the acquisition date would show which of the following? a. A goodwill liability of $20 million