Which of the Following Statements Is in Accordance with AASB

question 13

Multiple Choice

Which of the following statements is in accordance with AASB 127 "Consolidated Financial Statements" with respect to multiple acquisitions?

• A) Each individual investment in the subsidiary is accounted for separately and separate consolidation worksheet entries are made to eliminate each investment on consolidation.
• B) Once control of the subsidiary is established, consolidation worksheet entries will eliminate the parent entity's respective share of the subsidiary's net identifiable assets as at each of the respective investment dates (at fair value).
• C) The aggregate costs of the investments would be eliminated against the parent's share of capital and reserves at the date when control is ultimately established and only one amount of goodwill (or bargain gain on purchase) is calculated.
• D) Because eliminations of each investment are made at the various investment dates, there is a need to calculate a separate amount of goodwill (bargain gain on purchase) for each investment date.
• E) All of the given answers.

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Definitions:

Obligation

A legal or moral duty to do something or to refrain from doing something.

Agents

Individuals or entities authorized to act on behalf of another (the principal) in dealings with third parties, typically creating a legal or business relationship.

Sole Proprietorships

A simple business structure where a single individual owns and operates the business.

Action Against Directors

Legal proceedings initiated to hold directors of a company responsible for their actions or omissions that harm the company or its stakeholders.