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?

 

  1. 75000
  2. 50000
  3. 37500
  4. 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

 

  1. 300000
  2. 150000
  3. 100000
  4. 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.

 

  1. 210
  2. 200
  3. 220
  4. 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

 

  1. (10)
  2. (20)
  3. (50)
  4. (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

 

  1. 10
  2. 15
  3. 20
  4. 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

 

  1. 100
  2. 150
  3. 180
  4. 200

Answer: 4

 

CA Final - Paper 1 - FR - Chapter 9   

 

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