Assume That Assets Are Held for Use and Not Offered

question 23

Multiple Choice

Assume that assets are held for use and not offered for sale and that PV = present value,MV = net market value and RC = current replacement cost.If PV > MV > RC,the deprival value of the asset is:

• A) current replacement cost
• B) present value
• C) net market value
• D) cannot be determined

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Definitions:

Proportionate Interest Goodwill Method

An accounting method used to calculate goodwill in the consolidation of financial statements, based on the parent company's proportionate share in the net assets of the subsidiary.

Goodwill Impairment Losses

are losses recognized when the carrying amount of goodwill exceeds its recoverable amount.

Indirect NCI

Refers to a non-controlling interest in an entity that is owned through another subsidiary rather than directly.

Allocation of the Dividend

The process of distributing a portion of a company's earnings, decided by the board of directors, to its shareholders in proportion to their shareholding.