alleryStart learning →At acquisition, the equity method identifies goodwill or which other item?
ARevenue reserve
BCapital reserve
CDeferred revenue
DMinority interest
Answer & Solution
Correct answer: B. Capital reserve
A shortfall of cost below the share of net assets appears as capital reserve, mirroring goodwill on an excess.
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Related questions
An enterprise controlled by another enterprise is called a what?Consolidated financial statements present a group as what?An enterprise is NOT an associate if it is what?A 40% held associate revalues assets with a surplus of Rs 2,00,000. Adjustment to carryingA 30% associate sold goods to the investor at Rs 50,000 profit, still unsold. Elimination?A Rs 4,00,000 investment has an equity carrying amount of Rs 4,50,000 when influence ends.Unrecognised loss share is Rs 30,000. The investor's share of the next profit is Rs 50,000Rs 8,00,000 buys 40% of an associate with net assets of Rs 15,00,000. What is the goodwill