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More Limited owns 90% of the share capital of Egg Limited. Egg Limited paid a dividend of $30 000 during the financial period. The adjustment entries in the consolidation worksheet for the dividend include which of the following?

Select one:

DR Dividend revenue $27 000

DR Dividend revenue $30 000

DR Dividend paid $30 000

DR Dividend receivable $27 000

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AASB 12/IFRS 12 Disclosure of Interests in Other Entities requires disclosure of which of the following for each subsidiary that has a non-controlling interest?

Select one:

Accumulated non-controlling interests of the subsidiary at the end of the

reporting period

The subsidiarys principal place of business

The proportion of ownership interests held by non-controlling interests.

All of the options are correct

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A consolidated statement of comprehensive income discloses the non-controlling interest as:

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a separate component of profit before tax and a separate component of tax

expense

a separate portion of profit or loss attributable to the non-controlling interest

a separate component of each line item of revenue and expense

a separate component of revenue

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Realty Group had the following debits in the pre-acquisition entry used to consolidate a 60% direct ownership interest in a subsidiary:

Retained earnings $60 000

Share capital $120 000

General Reserve $24 000

BCVR $12 000.

The amount attributable to the direct non-controlling interest is:

Select one:

$86 400

$129 600

$216 000

$144 000

Which of the following statements is correct?

Select one:

The NCI is not entitled to a share of consolidated equity

The NCI is entitled to a share of consolidated equity

To calculate the NCI share of equity, the subsidiarys equity at the end of the

reporting period is divided into five parts

The entry to reflect the NCI share of equity at acquisition date changes every year

that consolidated financial statements are prepared

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On 1 July 2019, Humpty Ltd acquired 20% of the shares in Dumpty Ltd, which gave Humpty Ltd significant influence over Dumpty Ltd.

In the financial year ended 30 June 2020, Dumpty Ltd recorded a profit of $20,000 after tax. On 1 July 2019, Humpty Ltd sold inventories to Dumpty Ltd for $15 000. The original cost was $10,000. Dumpty Ltd still holds 100% of this inventory by 30 June 2020.

What would be the journal entries in the records of Humpty Ltd for the year ended 30 June 2020?

Select one:

Dr Sales $15 000

Cr Cost of Sales $10 000

Cr Inventory $5 000

Dr Investment $4 000

Cr Share of Profit $4 000

Dr Investment $3 000

Cr Share of Profit $3 000

Dr Sales $3 000

Cr Cost of Sales $2 000

Cr Inventory $1 000

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The accounting method applied to investments in associates, known as the equity method, is also known as the:

Select one:

multi-line consolidation method

entity method of consolidation

one-line consolidation method

significant influence method

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Cheery Limited acquired a 25% interest in Berry Limited for $500 000. Cheery holds other equity investments but does not prepare consolidated financial statements. Berry Limited revalued its Plant upwards by $450 000 during the current financial period.

The balance of the investment in associate account at the end of the current financial period is:

Select one:

$612 500

$950 000

$450 000

$562 500

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Which of the following statements is incorrect?

Select one:

The assessment of the existence of significant influence requires judgement on the part of the accountants

Significant influence requires the investor to have the power or capacity to

participate in the investees financial and operating policy decision

Significant influence requires the investor to actually exercise its power over the

investee

The key criterion for identifying a joint arrangement is that the joint venturers have joint control over the joint venture

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Where there are transactions between the investor and associate that result in an unrealised profit, the investors share of the associates profit is:

Select one:

adjusted only if the transaction is an upstream one

adjusted regardless of whether the transaction is an upstream or downstream one

not adjusted at all regardless of whether the transaction is an upstream or downstream one

adjusted only if the transaction is a downstream one