FR D Preparing consolidated financial statements

The parent issues 400,000 shares valued at $3.00 and pays $500,000 cash. NCI at fair value is $400,000 and the subsidiary's net assets at fair value are $1,900,000. What is goodwill?

• 1 $200,000
• 2 $1,700,000
• 3 $500,000
• 4 $300,000

A subsidiary sold goods costing $40,000 to the parent for $60,000, and half are still held. What is the unrealised profit?

• 1 $10,000
• 2 $20,000
• 3 $5,000
• 4 $30,000

A subsidiary sold goods costing $40,000 to the parent for $60,000, and half are still held. The NCI owns 20 percent of the subsidiary. How much of the unrealised profit adjustment is borne by the NCI?

• 1 $0
• 2 $10,000
• 3 $8,000
• 4 $2,000

A 25 percent associate was bought for $600,000 and has made post-acquisition profit of $200,000. What is the carrying amount of the investment under the equity method?

• 1 $600,000
• 2 $650,000
• 3 $550,000
• 4 $800,000

How is a subsidiary acquired part way through the year treated in the consolidated statement of profit or loss?

• 1 Only its results after the acquisition date are included
• 2 The full year is included
• 3 None of its results are included
• 4 Only its results before acquisition are included

Which fair value is used in the calculation of goodwill?

• 1 The value at the reporting date
• 2 The nominal value of the shares issued
• 3 The fair value of the consideration and of the subsidiary's identifiable net assets at acquisition
• 4 The book value of the subsidiary

What is non-controlling interest?

• 1 The part of the parent not owned by the public
• 2 The part of a subsidiary's equity not owned by the parent
• 3 A form of goodwill
• 4 A loan from the parent