Consolidation Less than 100% Ownership

Question 1

The entries made on its books during a fiscal period by a parent by a parent company using the equity method must be reversed on the consolidating worksheet at the end of the fiscal period.

True or false?

Answer 1

True

Question 2

If goodwill is recognized as part of the investment eliminating entry, amortization expense for goodwill must be recognized on the consolidating worksheet. True or false?

Answer 2

False

Question 3

If a parent carries an investment in a subsidiary using the equity method, the parent will recognize its share of the subsidiary net income when it is reported by the subsidiary. True or false?

Answer 3

True

Question 4

Any difference between the fair value of a subsidiary asset and the book value of that asset is recognized on the books of the parent. True or false

Answer 4

False