In the Situation in Which a Subsidiary Is Only Controlled

question 77

Multiple Choice

In the situation in which a subsidiary is only controlled temporarily,AASB 10 requires:

• A) the investment be recorded at fair market value and any gain or loss on acquisition recognised immediately in the statement of comprehensive income.
• B) the subsidiary to be treated as an associate and equity accounting applied.
• C) the results of the subsidiary for the period of time that it was controlled to be included in the consolidated accounts.
• D) the investment to be reported at cost and dividends be accrued when declared.

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Definitions:

Negative Situation

A circumstance or set of conditions that adversely affects individuals, groups, or outcomes.

Intensity

The degree of strength, force, or energy in an action, feeling, or phenomenon.

Wooden Leg

A prosthetic limb made of wood, used to replace a missing leg.

Harried

Feeling strained as a result of having too many demands or pressures; harassed.