Test Bank For Advanced Financial Accounting 13th Edition By Theodore Christensen, Complete Chapters 1 - 20, Verified Newest Version Test Bank For Advanced Financial Accounting 13th Edition By Theodore Christensen, Complete Chapters 1 - 20, Verified Newest Version Test Bank For Advanced Financial Ac...
12. Multinational Accounting: Issues in Financial Reporting and Translation of Foreign Entity Statements
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13. Segment and Interim Reporting
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14. SEC Reporting
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15. Partnerships: Formation, Operation, and Changes in Membership
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16. Partnerships: Liquidation
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17. Governmental Entities: Introduction and General Fund Accounting
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18. Governmental Entities: Special Funds and Governmentwide Financial Statements
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19. Not-for-Profit Entities
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20. Corporations in Financial Difficulty
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Chapter 1 Intercorporate Acquisitions and Investments in Other Entities
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1) Assuming no impairment in value prior to transfer, assets transferred by a parent comp
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any toanother entity it has created should be recorded by the newly created entity at the ass
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ets':
A) cost to the parent company. DT DT DT DT
B) book value on the parent company's books at the date of transfer.
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C) fair value at the date of transfer.
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D) fair value of consideration exchanged by the newly created entity.
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Answer: B Diffi DT DT
culty: 1 Easy DT DT
Topic: Internal Expansion: Creating a Business Entity; Valuation of Business Entities Lear
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ning Objective: DT 01-
01 Understand and explain the reasons for and different methods of business expansion, th
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e types of organizational structures, and the types of acquisitions.; 01 -
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03 Make calculations and prepare journal entries for the creation of a business entity.
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Bloom's:
Remember AACSB DT
: Reflective Thinking AICPA:
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T
FN Decision Makin DT DT
g
2) Given the increased development of complex business structures, which of the following
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T
regulators is responsible for the continued usefulness of accounting reports?
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A) Securities and Exchange Commission (SEC) DT D T DT DT
,B) Public Company Accounting Oversight Board (PCAOB)
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C) Financial Accounting Standards Board (FASB)
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D) All of the other answers are correct
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Answer: D Diffi DT DT
culty: 1 Easy DT DT
Topic: An Introduction to Complex Business Structures
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Learning Objective: 01- DT
01 Understand and explain the reasons for and different methods ofbusiness expansion, the
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T DT DT
DTtypes of organizational structures, and the types of acquisitions.
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Bloom's:
Remember AACSB DT
: Reflective Thinking AICPA
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T
: FN Reporting DT
3) A business combination in which the acquired company's assets and liabilities are combined
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T
with those of the acquiring company into a single entity is defined as:
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A) Stock acquisition DT
B) Leveraged buyout DT
C) Statutory Merger DT
D) Reverse statutory rollup D T DT
, Answer: C Diffi DT DT
culty: 1 Easy DT DT
Topic: Organizational Structure and Financial Reporting DT D T D T DT
Learning Objective: 01- DT
04 Understand and explain the differences between different forms ofbusiness combinations.
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T DT
Bloom's:
Remember AACSB DT
: Reflective Thinking AICPA:
D T DT D
T
FN Decision Makin DT DT
g
4) In which of the following situations do accounting standards not require that the fin
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ancialstatements of the parent and subsidiary be consolidated?
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A) A corporation creates a new 100 percent owned subsidiary
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B) A corporation purchases 90 percent of the voting stock of another company
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C) A corporation has both control and majority ownership of an unincorporated company
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D) A corporation owns less-than a controlling interest in an unincorporated company
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Answer: D Diffi DT DT
culty: 1 Easy DT DT
Topic: Organizational Structure and Financial Reporting DT D T D T DT
Learning Objective: 01- DT
01 Understand and explain the reasons for and different methods ofbusiness expansion, the t
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T DT DT DT
ypes of organizational structures, and the types of acquisitions.
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Bloom's:
Remember AACSB DT
: Reflective Thinking AICPA:
D T DT D
T
FN Decision Makin DT DT
g
During its inception, Devon Company purchased land for $100,000 and a building for $180,00
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0. After exactly 3 years, it transferred these assets and cash of $50,000 to a newly created subsid
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iary,Regan Company, in exchange for 15,000 shares of Regan's $10 par value stock. Devon
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uses straight- DT
line depreciation. Useful life for the building is 30 years, with zero residual value. An apprai
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sal revealed that the building has a fair value of $200,000.
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5) Based on the information provided, at the time of the transfer, Regan Company should record:
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A) Building at $180,000 and no accumulated depreciation.
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B) Building at $162,000 and no accumulated depreciation.
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C) Building at $200,000 and accumulated depreciation of $24,000.
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D) Building at $180,000 and accumulated depreciation of $18,000.
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Answer: D Difficult DTDT DT
y: 2 Medium
DT D T
Topic:
Valuation of Business Entities; Accounting for Internal Expansion: Creating Busi
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ness Entities DT
Learning Objective: 01- DT
04 Understand and explain the differences between different forms of business combinations.
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; 01-03 Make calculations and prepare journal entries for the creation of a business entity.
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