Federal Taxation 2014 Corporations‚ 27e Chapter C8 Consolidated Tax Returns 1) To be an affiliated group‚ the parent corporation must directly own at least 80% of another group member. Answer: TRUE Page Ref.: C:8-2 Objective: 1 2) A Canadian subsidiary cannot file as part of the consolidated group with its U.S. parent. Answer: FALSE Page Ref.: C:8-5 through C:8-6 Objective: 1 3) Brother-sister controlled groups can elect to file a consolidated tax return. Answer: FALSE Page Ref.: C:8-4 Objective:
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CHAPTER 3 AN INTRODUCTION TO CONSOLIDATED FINANCIAL STATEMENTS Answers to Questions 1 A corporation becomes a subsidiary when another corporation either directly or indirectly acquires a majority (over 50 percent) of its outstanding voting stock. 2 Amounts allocated to identifiable assets and liabilities in excess of their recorded amounts on the books of the subsidiary are not recorded separately by the parent. Instead‚ the parent company records the purchase price of the interest acquired
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Multiple Choice Questions 1. Blue Company owns 70 percent of Black Company’s outstanding common stock. On December 31‚ 2008‚ Black sold equipment to Blue at a price in excess of Black’s carrying amount‚ but less than its original cost. On a consolidated balance sheet at December 31‚ 2008‚ the carrying amount of the equipment should be reported at: A. Blue’s original cost. B. Black’s original cost. C. Blue’s original cost less Black’s recorded gain. D. Blue’s original cost less 70 percent of Black’s
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23.1 Explain the meaning of consolidated financial statements Learning Objective 23.2 Discuss the meaning and application of the criterion of control Learning Objective 23.3 Discuss which entities should prepare consolidated financial statements Learning Objective 23.4 Understand the relationship between a parent and an acquirer in a business combination Learning Objective 23.5 Explain the differences in disclosure requirements between single entities and consolidated entities.
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the consolidated group with its U.S. parent. 3) Brother-sister controlled groups can elect to file a consolidated tax return. 4) An advantage of filing a consolidated return is that losses of one affiliated group member may be offset against the taxable income of other group members in the same tax year. 5) The election to file a consolidated return is made annually. 6) A separate return year is a corporation’s tax year for which it files a separate tax return or files a consolidated tax return
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PROJECT ON ACCOUNTING STANDARDS 1. ACCOUNTING STANDARD 16 2. ACCOUNTING STANDARD 21 SUBMITTED TO: PROF. T.K. NAGPAL SUBMITTED BY: VARUN FN3 FN2 Accounting Standard (AS) 16 (issued
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CHAPTER 3 THE REPORTING ENTITY AND CONSOLIDATED FINANCIAL STATEMENTS ANSWERS TO QUESTIONS Q3-1 The basic idea underlying the preparation of consolidated financial statements is the notion that the consolidated financial statements present the financial position and the results of operations of a parent and its subsidiaries as if the related companies actually were a single company. Q3-2 Without consolidated statements it is often very difficult for an investor to gain an understanding
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A PROJECT REPORT ON CONSOLIDATED FINANCIAL STATEMENT SUBMITTED TO THE UNIVERSITY OF MUMBAI AS A PARTIAL REQUIREMENT FOR COMPLETING THE DEGREE OF M.COM (ACCOUNTS) SEMESTER I SUBJECT: ADVANCED FINANCIAL ACCOUNTING SUBMITTED BY: SHUBALAXMI.UMESH.SHETTY ROLL NO.: 47 UNDER THE GUIDANCE OF PROFESSOR DHANABALU.R.NAIKAR SIES COLLEGE OF COMMERCE AND ECONOMICS‚ PLOT NO. 71/72‚ SION MATUNGA
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amount of inventory will be included in the consolidated balance sheet immediately following the acquisition? A. $0 B. $65‚000 C. $70‚000 D. $60‚000 2. Based on the preceding information‚ what amount of land will be included in the consolidated balance sheet immediately following the acquisition? A. $0 B. $10‚000 C. $90‚000 D. $100‚000 3. Based on the preceding information‚ what amount of buildings and equipment (net) will be included in the consolidated balance sheet immediately following the
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annual amortization – like CH 3 -Maintain investment and equity in sub income accounts -Determine the consolidated totals (consolidated NI‚ equipment‚ etc.)‚ consolidated NI to CI‚ consolidated NI to NCI‚ and ending NCI. -Understand what value (book value vs. fair value) should be included in the computation of consolidated totals. -The relation between numbers on parent’s book and the consolidated totals under equity method -Step acquisition/remeasurement CH5 - Maintain investment and equity
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