Manuel Ltd

question 27

Multiple Choice

Manuel Ltd. purchases 65% of Faiz Co. Under the entity method of consolidation, what is allocated to non-controlling interest?

• A)35% of Faiz's net assets at fair value.
• B)35% of Faiz's net assets at carrying value plus 35% of Faiz's fair value increments including goodwill.
• C)35% of Faiz's net assets at carrying value.
• D)35% of Faiz's net assets at carrying value plus 35% of Faiz's fair value increments excluding goodwill.

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Definitions:

Profit

This is the financial gain obtained when the amount earned from a business activity exceeds the costs, expenses, and taxes needed to sustain the activity.

Quantity Demanded

The sum of a particular good or service that customers are ready and financially able to buy at a given price.

Productivity

The measure of the efficiency of production, often quantified as the ratio of outputs produced to inputs used in the production process.

Factor Labor

This refers to the human effort, both physical and mental, used in the production of goods and services.