Which of the following statements regarding pre-acquisition entries prepared after acquisition date is incorrect?

Select one:

a.They are adjusted for transfers between post-acquisition equity accounts.

b.They include the pre-acquisition entry prepared at acquisition date adjusted for the effects of all the transfers between pre-acquisition equity accounts and changes in the investment account up to the beginning of the current period.

c.They reverse the transfers between pre-acquisition equity accounts and changes in the investment account that happen in the current period.

d.They are adjusted for the changes in the investment account recognised by the parent in the subsidiary.

As per AASB 137 Provisions, Contingent Liabilities and Contingent Assets, the appropriate treatment for a contingent asset in the financial statements of an entity is:

Select one:

a.recognition in the financial statements, and note disclosure.

b.recognition in the financial statements, but no further disclosure in the notes.

c.do not recognise in the financial statements, and do not disclose in the notes.

d.disclosure of information in the notes, but do not recognise in the financial statements.

A parent entity group sold a depreciable non-current asset to a subsidiary entity for $5 300. The asset originally cost $7 000 when acquired from an external party and at the date of the intragroup sale the accumulated depreciation was $2 200. The amount of the unrealised gain on the intragroup sale to be eliminated is:

Select one:

a.$500.

b.$2 200.

c.$4 800.

d.$5 300.

AASB 137 requires provisions to be recognised when:

I. there has been a past event.

II. an entity has a present obligation.

III. the amount of the obligation can be reliably estimated.

IV. it is possible that an outflow of resources will be required to settle the obligation.

Select one:

a.I, II and III.

b.II, III and IV.

c.I, III and IV.

d.I, II and IV.