1.

On the acquisition of a subsidiary by an investor, purchased goodwill

should be:
a.Recognised in the financial statements of either the subsidiary or investor
b.Recorded separately in the financial statements of the subsidiary only
c.Recorded in a consolidation adjusting entry
d.Recognised separately in the financial statements of the investor only
 
2. At 1 January 20X4 Yogi acquired 80% of the share capital of Bear for
$1,400,000. At that date the share capital of Bear consisted of 600,000
ordinary shares of 50c each and its reserves were $50,000. The fair value of
the non-controlling interest was valued at $525,000 at the date of
acquisition.In the consolidated statement of financial position of Yogi and its
subsidiary Bear at 31 December 20X8, what amount should appear for
goodwill?
a.$1,575,000
=>> PP toàn bộ (vì cho sẵn FV của NCI)
=>> Goodwill =  1400 + 525 - 600 * 0.5 (tại giá là 50 cent = 1/2 $) - 50 = 1575
b.$630,000
c.$1,050,000
d.$450,000
3. On 1 July 2019, A Ltd pays £870,000 to acquire the entire share capital of
B Ltd. The equity of B Ltd on that date consists of ordinary share capital of
£400,000 and retained earnings of £210,000. The fair value of the non-current
assets of B Ltd on 1 July 2019 exceeds their carrying amount by £35,000. Tax
rate 20%. The amount paid for goodwill by A Ltd is?
a.£260,000
b.£232,000
= 870 - [400 + 210 + 35*80%] = 232 
Không có NCI vì mua toàn bộ
Cộng 35*80% vì phải cộng thêm chênh lệch FV của tài sản mà có tính đến sự ảnh
hưởng của thuế
c.£225,000
d.£470,000
 
 
4.Which of the following statements is not a key feature of the acquisition
method?
a.An acquirer being identified for each business combination amortization
b.The goodwill being measured as the consideration transferred plus the amount of
any NCI interest plus the fair value of any previously held equity interest in the
acquire less the fair value of the identifiable net assets acquired.
c.The acquired identifiable net assets being measured at the fair value
d.The cost of business combination being measured at fair value  of the net assets
received from the acquiree
 
5. Which of the following statement(s) is / are correct with regard to
preparation of consolidated financial Statement?
i) To be a subsidiary a parent should hold 100% of its equity shares
ii) Consolidation merely addition together of two Statements of financial position
iii) In consolidation a subsidiary and an associate are treated identically
iv) Consolidated balance sheet excludes assets not owned by the group
a.ii&iii     
b.i&ii      
c.ii&iv
d.None
 
6. Applying the acquisition method involves the following steps: 
(i)Identifying an acquirer; (ii)Measuring the cost of the combination.
(iii)Allocating, at the acquisition date, the cost of the combination to the assets
acquired and liabilities and contingent liabilities assumed. (iv)Amortizing the
goodwill.
a.ii – iii
b.i – iv
c.i – iii
d.i – ii
7. In relation to goodwill arising from a business combination, which of the
following statements in accordance with IFRS 3 Business Combination
a.Goodwill is only tested for impairment if circumstances indicate it may be
impaired
b. Goodwill should be measured at cost less accumulated impairment losses
c.Goodwill should be amortized on a straight – line basis over its useful life
d.Goodwill should be measured as cost less accumulated amortization
 
8. The amount of profit attributable to the non-controlling interest in a 90%
subsidiary is generally equal to:
a.10% of the subsidiary's profit before tax       
b.10% of the group profit after tax                 
c.10% of the group profit before tax
d.10% of the subsidiary's profit after tax
 
9. Which of the following companies would qualify to be regarded as
subsidiaries of Alpha?
i) Beta in which Alpha has 15% votes and a place on the board of directors
ii) Delta in which Alpha has 52% votes but no place on the board of directors
iii) Gamma in which Alpha has 25% shares and two places on the board of
directors
iv) Theta in which Alpha holds 100% votes and all places on the board of directors
a.(ii) & (i)      
b.ii&iv         
c.ii&iii        
d.i&iii
 
10. On 1 January 2013, E Ltd paid £560,000 to acquire 80% of the ordinary
share capital of F Ltd. The equity of F Ltd on that date consisted of ordinary
share capital of £300,000 and retained earnings of £150,000. All of its assets
and liabilities were carried at fair value. On 31 December 2016, the retained
earnings of E Ltd and F Ltd are £1,870,000 and £65,000 respectively.
Goodwill arising on consolidation has suffered an impairment loss of 70%
since 1 January 2013. The retained earnings figure which should be shown in
the consolidated statement of financial position at 31 December 2016 is:
GW=200,000 (560,000–80%*(300,000+150,000))=>impairment loss is 140,000 (70
%*200,000). The retained earnings of F Ltd have decreased by £85,000 since acquisition. 80
% of this is 68,000. Therefore group retained earnings at 31 December 2016 are (1,870,000 –
68,000–140,000) =1,662,000.
a.£1,725,000
b.£1,662,000
c.£1,645,000
d.£1,708,000
 
11. IFRS 3:
a.Allows either the unitings of interest method, or the acquisition method
b.Allows only the acquisition method or merger method
c.Allows only the acquisition method
d.Allows only the unitings of interest method
 
12. At 1 January 20X6 Fred acquired 75% of the share capital of Barney for
$750,000. At that date the share capital of Barney consisted of 20,000
ordinary shares of $1 each and its reserves were $10,000. The fair value of the
non-controlling interest was valued at $150,000 at 1 January 20X6.
In the consolidated statement of financial position of Fred and its subsidiary
Barney at 31 December 20X9, what amount should appear for goodwill?
a.$150,000
b.$870,000
c.$720,000
d.$750,000
750+150-(20+10)
 
15. In accordance with IFRS 10 – Consolidated financial statements, a
consolidated statement of financial position (or note thereto) would not
present information relating to which of the following?
a. Investments in subsidiarie
b. NCI’share of consolidated net assets
c. Loans to entities not related to the group
d. Goodwill acquired by the group
 
 
16. Which of the following statements is / are correct with regard to
accounting for goodwill?   
a. Goodwill needs to be written off as soon as it is identified
b. Goodwill should be amortised over an estimated useful life
c. Goodwill is reported continuously as an asset unless it is impaired 
d. Goodwill should be amortised over an estimated useful life not exceeding
twenty years
 
17. On 1 January 2009, P Ltd paid £480,000 to acquire 65% of the ordinary
share capital of Q Ltd. The equity of Q Ltd on that date consisted of ordinary
share capital of £200,000 and retained earnings of £150,000. The fair value of
the non-current assets of Q Ltd on 1 January 2009 exceeded their carrying
amount by £250,000. Goodwill arising on consolidation has suffered an
impairment loss of 40% between 1 January 2009 and 31 December 2016. The
goodwill figure which should be shown in the consolidated statement of
financial position at 31 December 2016 is:
a. £36,000
b. £151,500
c. £78,000
d. £54,000
Net asset = 200 + 150 + 250 = 600 (không có trừ thuế vì đề không đề cập)
GW = 480 + 600*35% - 600 = 90 OR 480-600*65%
Khi xảy ra impairment loss -> trừ khoản loss khỏi goodwill -> 90 - 90*40% = 54
 
18. Negative goodwill should be (TN do mua rẻ)
a.Recorded in the income statement 
b.Ignore
c.Allocated to non-current assets
d.Matched to future losses
 
 
 
 
 
 
19. On 1 May 20X4, C Ltd paid £430,000 to acquire the entire share capital of
D Ltd. The equity of D Ltd on that date consisted of ordinary share capital of
£200,000 and retained earnings of £90,000. All of its assets and liabilities were
carried at fair value. On 30 April 20X6, the retained earnings of C Ltd and D
Ltd are £970,000 and £115,000 respectively. Goodwill arising on consolidation
has suffered an impairment loss of 25% since 1 May 20X4. Group retained
earnings at 30 April 20X6 are:
a.£1,085,000    
b.£ 980,000  
c.£1,050,000
d.£960,000    
GW=430-290=140=> impairment loss=25%*140=35. The retained earnings of D Ltd
have increased by 25(115-90) since acquisition. Therefore group retained earnings at 30 April
20x6 are (£970+25–35)=960
* Vì phần Retained Earnings của group sau thời điểm đạt quyền kiểm soát sẽ là
RE của mẹ + %của mẹ trong RE tăng thêm của con
 
21. Under IFRS 3, acquired contingent liabilities are:
a.Included in the cost of combination, only if they can be reliably measured
b.Always included in the cost of combination
c.Included in NCI
d.Included in goodwill
 
22.  If the capital and reserves, including fair valuation gain of a subsidiary is
£5,400 and the parent acquires the whole of it for £4,000, the difference of
£1,400 would be known as:
a.Badwill
b.Gain on acquisition
c.Goodwill
d.Negative goodwill   
 
23. In the consolidated statement of financial position of Yogi and its
subsidiary Bear at 31 December 20X8, what amount should appear for
goodwill?
a.$630,000
b.$1,575,000
c.$450,000
d.$1,050,000