MCQ for CA Final FR - Chapter 8 Ind AS 111 : Joint Arrangements & Consolidation Procedures
Sample Multiple Choice Questions (MCQ's) for CA Final - Paper 1 - Financial Reporting - Chapter 8: INDIAN ACCOUNTING STANDARD 111 : Joint Arrangements & Consolidation Procedures : - For Practice relevant for May/Nov 23 Examinations
Q:1 P and Q form a joint arrangement PQ using a separate vehicle.P and Q each own 50% of the capital of PQ. However, the contractual terms of the joint arrangement states that P has the rights to all of Machinery and the obligation to pay Bank Loan in PQ.P and Q have rights to all other assets in PQ and obligations for all other liabilities in PQ in proportion to their share of capital (i.e. 50% each).
PQ’s balance sheet is as follows:
| Liabilities | ₹ | Assets | ₹ |
| Capital | 1,50,000 | Machinery | 2,50,000 |
| Bank Loan | 75,000 | Cash | 50,000 |
| Other Loan | 75,000 | ||
| 3,00,000 | 3,00,000 |
How should P record in its financial statements its rights and obligations in PQ?
Other Loan?
- 75000
- 50000
- 37500
- 25000
Answer: 3
Q:2 KL Ltd. has invested in 50% voting power of a joint venture MN Ltd. MN Ltd. has also issued 10% cumulative preference shares to other investors worth `10,00,000.During the year, MN Ltd. earned profit of `4,00,000. Also, MN Ltd. has not declared any dividend on the preference shares for current year. Calculate KL Ltd.’s share in the net profit of MN Ltd. for the year
- 300000
- 150000
- 100000
- 180000
Answer: 2
Q:3 Ram Ltd. Acquires 60% of Raja Ltd. By paying cash consideration of `750 lakh (including control premium).The fair value of non-controlling interest on the date of acquisition is `480 lakh.The value of subsidiary’s identifiable net assets as per Ind AS 103 is `1,000 lakh. Determine the value of goodwill using Fair Value Method.
- 210
- 200
- 220
- 230
Answer: 4
Q:4 X Ltd. Acquires 80% of Y Ltd. By paying cash consideration of `400 lakh. The fair value of non- controlling interest on the date of acquisition is `100 lakh.The value of subsidiary’s identifiable net assets as per Ind AS 103 is `520 lakh. Determine the value of gain on bargain purchase using Fair value method
- (10)
- (20)
- (50)
- (5)
Answer: 2
Q:5 M Ltd. Acquires 100% of N Ltd. By paying cash consideration of `100 lakh. The value of subsidiary’s identifiable net assets as per Ind AS 103 is `80 lakh. Determine the value of goodwill
- 10
- 15
- 20
- 25
Answer: 3
Q:6 RS Ltd. Holds 30% stake in PQ Ltd. This investment in PQ Ltd. Is accounted as an investment in associate in accordance with Ind AS 28 and the carrying value of such investment in `100 lakh. RS Ltd. Purchases the remaining 70% stake for a cash consideration of `700 lakh. The fair value of previously held 30% stake is measured to be `300 lakh on the date of acquisition of 70% stake.
The value of PQ Ltd.’s identifiable net assets as per Ind AS 103 on that date is `800 lakh. Calculate Goodwill
- 100
- 150
- 180
- 200
Answer: 4
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