Amortization of fair value over cost reduces the investment account 3. After allocating cost in excess of book value‚ which asset or liability would not be amortized over a useful life? A. Cost of goods sold B. Property‚ plant‚ & equipment C. Patents D. Goodwill E. Bonds payable 4. A company should always use the equity method to account for an investment if A. it has the ability to exercise significant influence over the operating policies of the investee. B. it owns 30% of another company’s stock. C
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The Impact of Assets Impairment on Company Accounts Assignment 1 ACCT 20054 – Company Accounting Term 2‚ 2012 Prepared & Submitted by Jobish Mathew S0214315 Tutor: Davood Alizadeh Due date: 24th August 2012 Submitted date: 24th August 2012 Executive Summary The study ‘The Impact of Assets Impairment on Company Accounts’ presents the cotemporary issues facing by major five Australian companies Qantas‚ Ten Networks‚ Billabong‚ Bluescope steel and Harvey Norman. This research
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prepaid accounts fall under this. Rule- Dr. the receiver Cr. the giver 2. Real Accounts- All assets‚ tangible & intangible come under this. Tangible assets like land & building‚ plant & machinery‚ furniture etc. and Intangible assets like goodwill‚ patents‚ trademarks etc. Rule- Dr. what comes in Cr. what goes out 3. Nominal Accounts- All expenses‚ losses‚ incomes and gains come under this. Rent‚ wages‚ salaries‚ interest‚ bad debts etc. are some examples. Rule- Dr. all expenses
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Sales Returns and Allowances $30‚000. BE9-13 Information related to plant assets‚ natural resources‚ and intangibles at the end of 2011 for Spain Company is as follows: buildings $1‚100‚000; accumulated depreciation—buildings $650‚000; goodwill $410‚000; coal mine $500‚000; accumulated depletion—coal mine $108‚000. Prepare a partial balance sheet of Spain Company for these items. Exercise Do It! 9 Match the statement with the term most directly associated with it E9-9
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• Consolidation journals are posted into the consolidation worksheet in “adjustment” columns as follows: Extract only Parent P Ltd. $’000 Subsidiary S Ltd. $’000 Adjustments DR Lecture 9 part b Consolidation: Wholly owned subsidiaries Prepared by Emma Holmes and Rick Newby Land Invt in S Ltd Receivables Cash 400 120 200 40 760 150 Share capital Retained earnings Creditors 500 160 100 760 100 20 50 170 Cons. Balances CR XX XX XX
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The Reporting Entity and the Consolidation of Less-than-Wholly-Owned Subsidiaries with No Differential P3-33 (Page 144-145) Consolidated Worksheet and Balance Sheet on the Acquisition Date (Equity Method) Peanut Company acquired 90 percent of Snoopy Company’s outstanding common stock for $270‚000 on January 1‚ 20X8‚ when the book value of Snoopy’s net assets was equal to $300‚000. Peanut uses the equity method to account for investments. Trial balance data for Peanut and Snoopy as of January 1
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liability at each step for the purposes of calculating a portion of goodwill has been removed. Instead‚ goodwill is measured as the difference at acquisition date between the fair value of any investment in the business held before the acquisition‚ the consideration transferred and the net assets acquired. • Acquisition-related costs. Acquisition-related costs are generally recognised as expenses (rather than included in goodwill). • Contingent consideration. Contingent consideration must be recognised
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combination of the income statements and balance sheets the overall ROE which consists of Square Ds 18.9% and Schneider’s net of 9.1% would net out to an 11.4%. If the savings were included the rate would move up to 12.9%. This is of course excluding any goodwill‚ write-downs and restructuring charges. Obviously Square Ds earnings of $115 million on and equity of $603 million (18.9%) are an attractive addition to Schneider’s balance sheet‚ but it does appear that they are more interested in gaining the distribution
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ch5 Key 1. On November 8‚ 2009‚ Power Corp. sold land to Wood Co.‚ its wholly owned subsidiary. The land cost $61‚500 and was sold to Wood for $89‚000. From the perspective of the combination‚ when is the gain on the sale of the land realized? A. Proportionately over a designated period of years B. When Wood Co. sells the land to a third party C. No gain can be recognized D. As Wood uses the land E. When Wood Co. begins using the land productively Difficulty: Easy Hoyle - Chapter 05 #1 2. Edgar
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Preparation of Consolidated Statement of Financial Position 1 The consolidation process • Before consolidating‚ it may be necessary to adjust subsidiary’s financial statements where: 1. The subsidiary’s end of reporting period is different to the parent’s. In such cases the subsidiary is required to prepare adjusted financial statements as at the parent’s reporting date. 2. The subsidiary’s accounting policies are different to the parent’s. In such cases the subsidiary is required to
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