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nika2105 [10]
3 years ago
11

What are new guidelines issued by GAAP for consolidating entities

Business
1 answer:
Brut [27]3 years ago
6 0
Consolidation Rules Under GAAP

The general rule requires consolidation of financial statements when one company’s ownership interest in a business provides it with A MAJORITY OF the voting power- meaning it controls more then 50% of the voting shares
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3 years ago
Pal Corp.'s 2004 dividend income included only part of the dividend received from its Ima Corp. investment. The balance of the d
VashaNatasha [74]

Answer:

Fair Value method, and only a portion of Ima's 2004 dividends represent earnings after Pal's acquisition.

Explanation:

The part of the dividend that reduce the carrying value of the investment can be said to be a liquidating dividend. Liquidating dividend is said to have occurred when the payment made by the investee is higher than the income that was earned in the course of the period in which the shares of the investee was owned by the investor.

On the other hand, the cost method treats liquidating dividends as spend or reduction in the investment account and treats normal dividend as income. Hence it is impossible for the firm to use equity method.

This is because dividend are seen as a reduction in investment account under the equity method. This means that dividends received cannot be taken as income in this method, hence C and D are wrong.

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3 years ago
According to U.S. GAAP, asset retirement obligations are ________.
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Answer:

D) long-term legal requirements to restore property

Explanation:

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3 years ago
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Answer:

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2 years ago
Caroline, the manager of a jewelry store, conducts statewide market research and collects data on customer preferences toward va
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3 years ago
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