Ch23 Tb Picker3e

Testbank

to accompany

Applying International Financial Reporting Standards 3e

By

Prepared by
Yeny Lukito and Emma Holmes

John Wiley & Sons Australia, Ltd 2013
Chapter 23

Consolidation: Controlled Entities

Learning Objectives

Learning Objective 23.1 Explain the meaning of consolidated financial statements

Learning Objective 23.2 Discuss the meaning and application of the criterion of control

Learning Objective 23.3 Discuss which entities should prepare consolidated financial statements

Learning Objective 23.4 Understand the relationship between a parent and an acquirer in a business combination

Learning Objective 23.5 Explain the differences in disclosure requirements between single entities and consolidated entities.

Multiple Choice Questions

1. The entity that is represented by a single set of consolidated financial statements known as a consolidated financial report, is:
Learning Objective 23.1 Explain the meaning of consolidated financial statements.
*a. an economic entity;
b. a parent entity;
c. a subsidiary entity;
d. a partnership.

2. When one entity controls the business operations of another entity, the business combination results in the following type of relationship:
Learning Objective 23.1 Explain the meaning of consolidated financial statements.
*a. parent-subsidiary;
b. partnership;
c. a merger;
d. dual-listed.

3. For the purposes of consolidated financial reporting, a group is:
Learning Objective 23.1 Explain the meaning of consolidated financial statements.
a. an entity that has no subsidiaries;
*b. a parent entity and all its subsidiaries;
c. an entity that has one or more subsidiaries;
d. a subsidiary entity of another entity.

4. IFRS 10 Consolidated Financial Statements, defines a ‘parent’ and a ‘subsidiary’ as:
Learning Objective 23.1 Explain the meaning of consolidated financial statements.

Parent
Subsidiary
a.
An entity which owns more than 50% of the voting shares of