Which of the following statements are correct? a.I., II. and III. only b.I. only c.I. and II.
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Question:
Which of the following statements are correct?
a.I., II. and III. only
b.I. only
c.I. and II. only
d.I., II., III. and IV.
I. | For a group of assets to constitute a business, they must be capable of being conducted and managed for the purpose of generating income. |
II. | The effect of an intragroup sale of inventories at a profit, where the inventories are still on hand at the end of the reporting period, is that both profit and the inventory asset are overstated. |
III. | The fair value adjustment entries may result in the recognition of assets and liabilities that are not recognised in the subsidiary's accounting records. |
IV. | A transfer between retained earnings and a general reserve after acquisition date will result in a corresponding change to the substitution elimination entry |
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