Harry Co Acquired 75% of Samir Ltd

question 57

Multiple Choice

Harry Co. acquired 75% of Samir Ltd. 3 years ago. In calculating the balance for the non-controlling interest share of net income, Harry started with the net income from Samir's current year-end single-entity financial statements. Which of the following adjustments must be added to Samir's net income in calculating NCI's share of net income?

• A)Unrealized gain on an upstream sale of a capital asset.
• B)Realized profits in the current year on upstream sales of inventory from the previous year.
• C)Unrealized profit on upstream sales of inventory in the current year.
• D)Amortization of fair value increments.

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Definitions:

Neurotoxin

A neurotoxin is a toxic substance that disrupts the normal function of nerve cells, potentially causing damage to the nervous system and leading to neurological symptoms or disorders.

Disinhibition Theory

Explanation holding that alcohol has a selective depressant effect on the brain’s frontal cortex, which controls judgment, while sparing subcortical structures responsible for more instinctual behaviors, such as desire.

Learned Inhibitions

Behaviors learned through experience that prevent an individual from engaging in certain actions.

Alcohol

A psychoactive substance commonly found in beverages such as beer, wine, and spirits, and known for its depressant effects.