Q14. In most situations, when the IAS accounting method allows for a choice between the equity method and proportionate consolidation, the use of the equity method will result in: A) ROA being higher and leverage being higher than under proportionate consolidation. B) ROA being lower and leverage being higher than under proportionate consolidation. C) ROA being higher and leverage being lower than under proportionate consolidation.
Q15. Under the purchase method of accounting for a merger or acquisition, if the fair market value of the tangible assets is less than the purchase price, the excess purchase price is: A) attributed to goodwill, which is depreciated over the estimated remaining life. B) proportionately allocated across all tangible assets, which is depreciated over their estimated remaining life. C) attributed to separately identifiable tangible and intangible assets, which the tangible assets are depreciated over their estimated remaining life.
Q16. Which of the following statements regarding the pooling of interests method of accounting for a merger or acquisition is least
accurate? A) The pooling of interests method combines two companies using fair market values at the time of the transaction. B) Ownership interests continue and former accounting bases are maintained. C) Operating results for prior periods are restated as though the two firms always operated as a single entity.
Q17. Which of the following statements regarding the differences between the purchase method of accounting for mergers and acquisitions and the pooling of interests method is least accurate? A) The purchase method recognizes one firm as being acquired by another, while the pooling of interests method views both participants as equals. B) The operating results of both companies prior to the acquisition are restated under the purchase method, but are not restated under the pooling of interests method. C) The underlying cash flows and economics of a merger or acquisition are same whether the purchase or the pooling of interests method is utilized.
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发表于 2009-1-7 15:35
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