Adjustments Made for the Purpose of Calculating the Incremental Adjustment

question 21

Multiple Choice

Adjustments made for the purpose of calculating the incremental adjustment to the share of profit of an associate are:

• A) recognised in the books of the investor.
• B) recognised in the books of the investee.
• C) notional adjustments and not included in the books of the investee.
• D) relate to realised transactions and so are recognised directly by the investee.

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Definitions:

Legal

Pertaining to the law or the system of rules that a particular country or community recognizes as regulating the actions of its members.

Financial

Pertaining to the management of money, investments, and other monetary transactions.

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The activities, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.