The abbreviated balance sheets and net income for Company A and Company B for the years 2020 and 2021 are as follows (as of 31^st December):

On 1^sJan 2021, that is on the first day of fiscal year 2021, the market value of equity of Company B was $1000 million. On that day, Company A purchased 60% of Company B for $ 600 million paying cash. You can assume the following:

($ Million)		COMPANY A			COMPANY B
		2020	2021		2020	2021
Cash		1000	1500		300	350
Other Assets		2000	2200		400	800
Total		3000	3700		700	1150
Liabilities		1000	1200		200	300
Equity		2000	2500		500	850
Total		3000	3700		700	1150
Net Income			500			350

• Assets and liabilities of Company B did not have to be revalued at the time of acquisition, so that their fair values as assessed by A are the same as the reported values
• Cash balance of A at the end of 2021 does not reflect the purchase of Bs shares
• As financial statements at the end of 2021 do not reflect the impact of investment in B
• No dividends were declared by B in 2021
• A can exercise complete control on the operations of B.

Q14. In 31st December 2021, what is the cash balance under the consolidated balance sheet of company A?

a.

1,250

b.

1,500

c.

1,800

d.

1,850

e.

None of the above

How much goodwill will the Company A recognize on 1st Jan 2021?

a.

100

b.

300

c.

500

d.

600

e.

None of the above

Q16. How much are the consolidated total assets of Company A as on 31st Dec 2021?

a.

3,700

b.

4,550

c.

4,750

d.

5,950

e.

None of the above

Q17. How much is the consolidated shareholders equity (including of non-controlling interest) of Company A as on 31st Dec 2021?

a.

2,710

b.

3,250

c.

3,310

d.

3,350

e.

None of the above

Q18. How much does Company A record as non controlling interest on 31st Dec 2021?

a.

0

b.

140

c.

340

d.

540

e.

None of the above

Q19. Assuming that the Company A had bought only 40% of company B, how much would be the total assets of company A, as on 31st Dec 2021? Assume that the Company A paid for the investment on the basis of book value of B, with no premium whatsoever.

a.

3,000

b.

3,700

c.

3,840

d.

4,200

e.

None of the above

Q20. Assuming that the Company A had bought only 15% of company B and recorded it as a passive investment. In that case, how much would be the total assets of company A, as on 31st Dec 2021?

a.

3,000

b.

3,075

c.

3,700

d.

3,775

e.

Cannot be determined based on data provided