AASB 127 Notes That in Preparing Consolidated Financial Statements,an Entity

question 21

True/False

AASB 127 notes that in preparing consolidated financial statements,an entity combines the financial statements of the parent and the subsidiaries line by line by adding together,in proportion to the degree of ownership,like items of assets,liabilities,income and expenses; but not equity balances:

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Definitions:

Interest Rate

The percentage charged by a lender to a borrower for the use of assets, typically expressed as an annual percentage of the principal.

Normal Return

The minimum profit necessary to keep a company in business, regarded as the cost of capital in the long run.

Investment

The allocation of resources, usually money, in order to earn a future return or profit.