Which One of the Following Statements Regarding IFRS and Accounting

question 11

Multiple Choice

Which one of the following statements regarding IFRS and accounting for step acquisitions is most correct?

• A) Under IFRS goodwill is identified and net assets remeasured to fair value for all subsequent transactions, both increasing and decreasing the ownership percentage, after control is achieved.
• B) IFRS requires the recording of additional goodwill on subsequent increases in the parent's ownership percentage.
• C) Under IFRS acquisition accounting is applied only at the date that control is achieved.
• D) IFRS requires the non-controlling interest to be measured at fair value.

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Definitions:

Income Tax Expense

The total amount of income tax a company is required to pay to the government, reflected as an expense in its income statement.

Deferred Tax Asset Valuation Allowance

A contra-asset account used to decrease the value of deferred tax assets if it is more likely than not they will not be realized.

Income Manipulation

The practice of adjusting financial statements with the intention to mislead stakeholders about the company's financial performance or health.