The Requirements of AASB 128 Relating to the Equity Method

question 3

Multiple Choice

The requirements of AASB 128 relating to the equity method of accounting for investments in associates include:

• A) Adjustments for impairment losses recognised by the associate.
• B) The notional adjustment of the carrying amounts of the identifiable assets, liabilities and contingent liabilities of the associate to fair value.
• C) The calculation of a notional goodwill or excess on acquisition that is not required to be separately disclosed.
• D) The revision of depreciation expense based on the notional fair value of the identifiable assets at the time of acquisition.
• E) All of the given answers.

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Definitions:

Resonance

A phenomenon in which a system's natural frequency of oscillation is excited by another oscillating system, leading to a significant increase in amplitude at certain frequencies.

Power Factor

A ratio indicating the efficiency with which an electrical system converts electrical power into useful work output, particularly in AC circuits.

RLC Parallel Circuit

An electrical circuit consisting of resistors (R), inductors (L), and capacitors (C) all connected in parallel, which can filter or resonate at certain frequencies.

Applied Voltage

Applied voltage is the electrical potential difference intentionally established across a component or circuit to induce current flow.