Under the Single-Date Method,goodwill Would Be Recognised

question 38

Multiple Choice

Under the single-date method,goodwill would be recognised.

• A) at the point in time when the parent entity ultimately gains control of the subsidiary.
• B) at the time when each additional acquisition of shares is made.
• C) as part of equity in the parent's books.
• D) at the point in time when the subsidiary shareholders acknowledge that they will sell their shareholdings to the parent entity.
• E) None of the given answers.

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Definitions:

Retained Earnings

The portion of a company's profits that are kept or retained and not paid out as dividends to shareholders.

Retained Earnings

The amount of net earnings remaining for the company after distributing dividends to its shareholders.

Shareholders' Equity

The ownership interest of shareholders in a company, calculated as the company's total assets minus its total liabilities.

Appropriations

The act of setting aside funds for a specific purpose, often used in government budgeting.