When Calculating the Direct Non-Controlling Interest Share of Equity, Consolidation

question 45

Multiple Choice

When calculating the direct non-controlling interest share of equity, consolidation adjustments are needed to:

• A) eliminate any realised profits or losses from inventories transfers.
• B) recognise any unrealised profits or losses from intragroup service transfers.
• C) fully eliminate any unrealised profits or losses from intragroup transactions.
• D) partially eliminate any unrealised profits from inventories transfers.

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Definitions:

Credit

An accounting entry that increases liability or equity accounts, or decreases asset or expense accounts.

Underapplied Manufacturing Overhead

A situation where the actual manufacturing overhead costs are higher than the overhead costs applied to products based on the predetermined overhead rate.

Overapplied Manufacturing Overhead

Occurs when the allocated manufacturing overhead costs are more than the actual overhead costs incurred.

Debit

An accounting entry that results in either an increase in assets or a decrease in liabilities on a company's balance sheet.