📏CPA EXAM PREP

For-Profit Financial Statements

Card1 / 71
Question

How is noncontrolling interest affected by subsidiary income and OCI?

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Answer

It gets its share, less NCI dividends.

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Question

Why is goodwill recognized in consolidation?

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Answer

It captures excess purchase price over fair value net assets.

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Question

What is the first consolidation step after combining parent and subsidiary accounts?

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Answer

Eliminate the investment account against subsidiary equity.

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Question

How does the VIE model differ from majority voting control?

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Answer

Control can exist without majority votes.

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