Holding Company Accounts
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This set of Corporate Accounting Multiple Choice Questions & Answers (MCQs) focuses on Holding Company Accounts
Q1 | If AB Ltd buys more than 50% of the shares in CD Ltd then which of the followingstatements accurately summarizes the relationship between these two firms?
- AB Ltd is a subsidiary undertaking of CD Ltd
- CD Ltd is the parent undertaking
- AB Ltd is the parent undertaking
- There is no significant financial relationship between the two
Q2 | On a consolidated balance sheet, if the shares of a company have been bought formore than the balance sheet value then the difference would appear as:
- Goodwill
- Capital reserve
- Loss on purchase
- Profit on purchase
Q3 | Pre-acquisition profit in subsidiary company is considered as:
- Revenue Profit
- Capital Profit
- Goodwill
- None of the above
Q4 | Profit earned after acquisition of share is treated as:
- Revenue Profit
- Capital Profit
- Goodwill
- None of the above.
Q5 | Profit earned before acquisition of share is treated as:
- Revenue Profit
- Capital Profit
- Goodwill
- Revaluation Profit
Q6 | Preparation of consolidated statements as per AS 21 is :
- Optional
- Mandatory for All
- Mandatory for listed companies.
- Mandatory for PVT. companies.
Q7 | Face value of debentures of subsidiary company, held by holding co.is deductedfrom:
- Debentures
- Cost of Control
- Minority Interest.
- Goodwill.
Q8 | Minority Interest includes:
- Share in share capital
- Share in capital profit
- Share in revenue profit
- All of the above.
Q9 | Preparation of Holding Companies Accounts Deals with :
- AS-22
- AS-21
- AS-25
- AS-12
Q10 | The time interval between the date of acquisition if shares in subsidiary companyand date of balance sheet of holding company is known as :
- Pre-acquisition period
- Post -acquisition period.
- Pre- commencement peri
Q11 | Shares are to be valued on ___________.
- Mergers
- Sale of shares
- Gift tax
- All of the above
Q12 | Quoted shares are those shares which are ___________.
- listed on the stock exchange
- quoted daily
- quoted by the seller
- quoted by the buyer
Q13 | Under net asset method, value of a share depends on ___________.
- net assets available to equity shareholders
- net assets available to debentures holders
- net assets available to preference shareholders
- none of the above
Q14 | Net asset value is also called as ___________.
- asset backing value
- intrinsic value
- liquidation value
- (a), (b) and (c)
Q15 | While deciding net asset value, fictitious assets ___________.
- should be considered
- should not be considered
- added to total assets
- none of the above
Q16 | Net asset value method is based on the assumption that the company is___________.
- a going concern
- going to be liquidated.
- A & B both
- none of the above
Q17 | Yield value depends on ___________.
- future maintainable profit
- paid-up equity capital
- normal rate of return
- none of the above
Q18 | F.M.P. for yield valuation is ___________.
- future profit
- profit that would be available to equity shareholders
- past profit
- none of the above
Q19 | Fair value of a share is equal to ___________.
- Intrinsic value only
- Yield value only
- Average of intrinsic and yield value
- None of the above
Q20 | Value of a partly paid equity share is equal to ___________.
- Value of fully paid share - calls unpaid per share
- Calls in arrears per share
- Paid-up value per share
- None of the above
Q21 | Investments are ………………. assets.
- Non trading
- Current
- Fixed assets
- Fictious
Q22 | ………………………….. value depends on Net assets.
- Yield value
- Fair value
- Intrinsic value
- none
Q23 | Yield value depends on……………………….
- Net profit
- Gross profits
- Operating profits
- Losses
Q24 | Fair value is the ……………… of intrinsic value and yield value.
- Average
- Total
- Net
- Difference
Q25 | EPS depends on net profit available to………………. Shareholders.
- Equity
- Preference
- Debenture
- Both A and B