Quiz(workings) - Name of Candidate Seminar Group Number...

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Name of Candidate………………………………………………………….. Seminar Group Number.……………………………………………………. Name of Instructor….……………………………………………………….. AC3102 – Risk Reporting and Analysis (Semester 2, 2015/2016) Mid–term Quiz Venue: LT 19A and LT 26 Date: 16 March 2016 (Wednesday) Starting time: 6.40pm Instructions (a) This quiz comprises Part A (80 marks) and Part B (20 marks) in 14 pages. (b) Part A (comprising ten independent short questions) begins in page 2 and ends in page 11. Part B (comprising one short case) is in page 12 (the answers to Part B are to be written in pages 13 and 14). (c) Write the answers in the space provided in this question paper (and do the workings (which will not be marked) in the space indicated). (d) Please write your name, your seminar group number and name of your instructor on the top of this page. (e) Time allowed is 1 hour and 30 minutes. (f) This is a closed-book quiz . (g) This Quiz constitutes 20% of the final marks for AC3102. (h) Any form of unprofessional and unethical behaviour during the quiz (e.g., making reference to any reference material, communicating with fellow candidates, continuing to write when the allotted time has expired) is unacceptable and will be heavily penalized. For the purposes of this Quiz, unless expressedly stated otherwise, assume (i) the companies are Singapore-incorporated, present annual financial statements with 31 December accounting year end in accordance with Singapore Financial Reporting Standards that are effective as at 1 January 2016, and that there is no change in their respective issued share capital over the years, (ii) the companies account for investments at cost in their separate financial statements and in their own financial statements, (iii) the groups adopt the policies of measuring non-controlling interests at acquisition date based on their proportionate share of the fair value of identifiable net assets of subsidiaries acquired, and the full proportionate method, (iv) a more-than-50% shareholding will give rise to control, and a 20%-to-50% shareholding will give rise to significant influence, and (v) there were no deferred tax effects. 1
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Part A Question 1 On 31 December 20x8, A Ltd paid $2,000,000 to acquire 60% of B Ltd when B Ltd’s net assets were represented by share capital of $1,000,000 and retained profit of $1,000,000. On the same date, A Ltd paid $1,000,000 to acquire 30% of C Ltd when C Ltd’s net assets were represented by share capital of $1,000,000 and retained profit of $1,000,000. On this date, each of the three companies had an unrecognized brand- name that was deemed to have a market value of $500,000 each. In A Ltd’s 20x8 consolidated financial statements: (a) Brand-name = $500,000 ................................................ (b) Goodwill on consolidation = $500,000 [2,000,000 – 60% x (1,000,000 + 1,000,000) – 60% x 500,000] (c) Investment in associate = $1,000,000 ...................................
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