Which of the following statements is incorrect?Group of answer choicesA bargain purchase gain arises when the purchase consideration is greater than the FVINA acquired.When a subsidiary has existing goodwill in their books at the date of acquisition, the amount of FVINA will decrease in the acquisition analysis.The Investment in subsidiary account is always eliminated on consolidation and this account will always be equal to zero for the group.If a company acquires shares in a subsidiary cum div, consolidation adjusting entries are required to eliminate dividend payable and dividend receivable up until the dividend is paid by the subsidiary.

Which of following statements is not correct in relation to the consolidation process?Group of answer choicesTo avoid double counting of the group's equity, the equity of the subsidiary at the acquisition date needs to be eliminated from the records of the subsidiary.Subsequent to the acquisition date, any intragroup transactions within the group needs to be adjusted and eliminated.The fair value adjustments of assets that were not previously recorded by the subsidiary are recognised in the business combination valuation entries.Consolidated financial statements should offset the carrying amount of the parent's investment in the subsidiary.

Which of the following statements is correct?Group of answer choicesAASB 3 Business Combinations requires that any revaluations of a subsidiary’s assets at acquisition date must be done in the consolidation worksheet.The revaluation of non-current assets in the subsidiary’s records means that the subsidiary has adopted the cost model of accounting for those assets.Revaluations of assets such as goodwill and inventory are not permitted in the accounting records of the subsidiary.Inventory can be revalued to an amount greater than its cost in the records of the subsidiary.

The investment elimination entry at the date of acquisition is necessary to:Group of answer choicesavoid overstating the equity and net assets of the parent.record the ‘Shares in subsidiary’ account in the parents records.avoid overstating the equity and net assets of the group.avoid understating the equity and net assets of the group.

UPS Corporation purchased a truck for $90,000 cash.  Which of the following statements is correct immediately after making this purchase?Group of answer choicesNet Income will decrease by $90,000Total Shareholder Equity will decrease by $90,000Total assets will remain the sameTotal liabilities will increase by $90,000

Which of the following statements is incorrect?Group of answer choicesconsolidated profit arises only in relation to transactions with entities external to the group.consolidated liabilities are obligations to entities external to the group.consolidated revenues are earned only from transactions with entities external to the group.consolidated assets are recorded at the cost to the legal entity that owns them.