Which of the Following Statements Is Correct

question 22

Multiple Choice

Which of the following statements is correct?
I made a change to the original question, as the original question is very similar to Q22.

• A) The NCI is not entitled to share the group's profit.
• B) Transactions that do not affect profit will not give rise to an adjustment to the NCI.
• C) All intragroup transactions have an impact on the NCI share of equity.
• D) When parent entity sells inventory to its subsidiary, a consolidation adjustment needs to be recorded to reduce the NCI.

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Definitions:

Owners' Equity

The residual interest in the assets of a company after deducting its liabilities, representing the owner's claim against the company's assets.

Cost Method

An accounting method used for investments, where the investment is recorded at cost and adjustments are only made for impairments or additional investments, without recognizing unrealized gains or losses.

Appraisal Method

An evaluation process to determine the value of an asset, often used for real estate and investments, based on various criteria.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) that serve as a global framework for financial statements.