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CIMAPRA19-F01-1 Exam - Topic 2 Question 11 Discussion

Which of the following is an effect of using equity accounting to include an entity in the consolidated statement of financial position of a group?
A) A single figure is included in net assets which is the sum of the initial cost of investment in the investee entity plus the group share of all changes in net assets since acquisition.
B) 100% of each asset and liability of the investee entity is included with the investing entity's balances.
C) The group share of each asset and liability of the investee entity is included with the investing entity's balances.
D) The investment in the investee entity is included in non-current assets at cost to the investing entity.

CIMAPRA19-F01-1 Exam - Topic 2 Question 11 Discussion

Actual exam question for CIMA's CIMAPRA19-F01-1 exam
Question #: 11
Topic #: 2
[All CIMAPRA19-F01-1 Questions]

Which of the following is an effect of using equity accounting to include an entity in the consolidated statement of financial position of a group?

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Suggested Answer: A

by Layla at May 08, 2022, 01:29 AM

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Tenesha
11 months ago
A makes sense, it's all about the initial investment plus changes!
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Crista
11 months ago
Wait, is D really how it’s done? That seems off.
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Eladia
11 months ago
C sounds right, you only share the group's portion.
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Rory
11 months ago
I disagree, B is misleading. You don't include 100% of assets.
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Dahlia
11 months ago
A is correct, that's how equity accounting works!
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Delmy
11 months ago
Hmm, I'm a bit unsure about this one. I know we need to set up the default warehouse, but I'm not sure if we should use the INV_DEFAULT_WHSE_ID or INV_DEFAULT_ORG_ID profile option. I'll need to review the details carefully.
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Keva
12 months ago
This looks straightforward. I just need to add the T/R spacing to the low site Tx frequency to get the high site Tx frequency. I'm confident I can solve this problem.
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