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Question 1
Parent Ltd acquired 80% of Subsidiary Ltd for $800,000 when Subsidiary's net identifiable assets had a fair value of $900,000. Parent measures non-controlling interest (NCI) using the proportionate share method under SFRS(I) 3. What is the goodwill recognized upon acquisition?
Correct Answer:
$$80,000
Question 2
Alpha Co acquired 75% of Beta Co on 1 January 2025. On acquisition date, Beta's net assets had a book value of $500,000 and fair value of $600,000. Alpha elects to measure NCI at fair value under SFRS(I) 3. The fair value of NCI on that date was $180,000. Consideration paid was $570,000. What is the goodwill to be recognized?
Correct Answer:
$$150,000
Question 3
Parent sold goods to its 80%-owned subsidiary for $100,000 at a mark-up of 25% on cost. At year-end, 40% of these goods remain in the subsidiary's inventory. What is the unrealized profit adjustment required on consolidation?
Correct Answer:
$$8,000 deduction from inventory
Question 4
Subsidiary (70% owned by Parent) sold inventory to Parent for $50,000 at a profit margin of 30% on selling price. Half of the inventory remains in Parent's warehouse at year end. How does the unrealized profit elimination impact the non-controlling interest (NCI)?
Correct Answer:
Reduces NCI share of profit by $2,250
Question 5
On 1 January 2024, Parent sold equipment with a carrying amount of $120,000 to its 100%-owned Subsidiary for $150,000. Subsidiary depreciates equipment at 20% per annum straight-line. What is the net adjustment to consolidated non-current assets at 31 December 2024?
Correct Answer:
Deduction of $24,000
Question 1
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About this Exam

Prepare with the SCAQ Foundation AFF Practice Questions - SCAQ Foundation Advanced Financial Reporting Examination Exam practice quiz. This question bank includes 100 questions covering sfrs, associate, parent, subsidiary, and value. Use it to review important concepts, identify knowledge gaps, and build confidence for the related exam, course, or assessment.

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SCAQ Foundation AFF Practice Questions - SCAQ Foundation Advanced Financial Reporting Examination Exam

This practice set contains 100 questions from the matching question bank and focuses on sfrs, associate, parent, subsidiary, and value. Work through each question carefully, review the provided solutions, and revisit topics that need more study before your next attempt.

This is an independent study resource intended for practice and review; it is not an official examination or an endorsement by any organization named in the title.

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