Determine and comment on the consolidation adjustments

Assignment Help Financial Management
Reference no: EM131340697

Mini Company is a wholly owned subsidiary of Maxi Company. At the end of the present accounting period, the following items will affect the consolidated financial statements:

1. During the year, Mini Company sold goods to Maxi Company for EUR 337 million. The cost of these goods for Mini Company was EUR 285 million. Maxi Company sold all these goods to third parties.

2. Maxi Company owes Mini Company EUR 75 million (trade payables).

3. Mini has a payable to Maxi for a long-term loan from Maxi for EUR 400 million.

4. Maxi earned interest for EUR 20 million from this loan during the year. Determine and comment on the consolidation adjustments that would be needed to prepare the consolidated financial statements.

Reference no: EM131340697

Questions Cloud

What are the two approaches to cost of capital : What are the two approaches to cost of capital. What product would you suggest that an American company introduce into China based on the current situation and the change to a “two-child” policy? Explain why direct financing transactions are more cos..
What is a minority interest : A consolidated income statement will show higher net profit than the parent-company-only income statement when both the parent and subsidiary have disclosed net profits in their respective income statements. Do you agree? Why?
Minor league baseball club is considering expansion : The Hannibal Homers minor league baseball club is considering an expansion of its stadium to increase capacity by 2,000 seats. Management estimates increased revenue from ticket and concession sales to be $600,000 per year for the next 5 years. If th..
What style of conflict handling would work best for you : Taking it further, what style of conflict handling would work best for you to use in negotiating a price for this house?
Determine and comment on the consolidation adjustments : Determine and comment on the consolidation adjustments that would be needed to prepare the consolidated financial statements.
Addressing challenges that arise in strategic-planning : No matter what your role is in an organization, you will most likely attend a significant number of meetings. For strategic planning in particular, meetings are an essential part of each phase of the process. What challenges have you noticed in th..
Watch the video and answer the given questions : Watch the video:Intestinal microbiota and human health.Do the abstracts of the research articles indicate there is evidence that studying intestinal microbiota can help doctors understand Crohn's disease and/or obesity?
Compare the units of each axis and the controlling variable : How does the spacing between steps of IB compare to the spacing betweensteps of VGS? Compare VCsat to VP in defining the nonlinear region at low levels of output voltage ur question here...
Identify the types of risks that are outlined in scenario : Identify the types of risks that are outlined in the scenario. Provide an explanation of the risks. Explain how you would measure the risks. Provide an example of how you would prevent or mitigate the risks in the future.

Reviews

Write a Review

Financial Management Questions & Answers

  Considering buying an investment

You are considering buying an investment that will be worth $55,000 when it matures in two years. If you want a rate of return of at least 15% compounding quarterly, what is the most you should be willing to pay for this investment?

  What is the bonds nominal yield to maturity

One year ago Clark Company issued a 10-year, 13% semiannual coupon bond at its par value of $1,000. Currently, the bond can be called in 6 years at a price of $1,065, and it now sells for $1,270. What is the bond's nominal yield to maturity? What is ..

  Current coupon-yield rates on bonds of different maturities

Discuss bond issues and prices in your country. Some specific items to discuss include: Research a specific bond (company or treasury that issues a bond) to determine the mechanism used for an initial offering. Where are bonds traded privately? What ..

  Calculate the elasticity coefficient

The Super Global International Food Market is filled with nuts, books, vegetables, fruits, rice, foreign DVDs, international magazines and more. Find foods from Armania, Turkey, Russia, India and beyond. The owner takes pride in offering fruits and v..

  Calculate the sample size

Determine the sample size needed to detect an increase of 5 points. Let alpha = 0.02 and beta = 0.05. Calculate the sample size

  Firm expects to pay dividends

A firm expects to pay dividends at the end of each of the next four years of $2.00, $1.50, $2.50, and $3.50. If growth is then expected to level off at 8 percent, and if you require a 14 percent rate of return, how much should you be willing to pay f..

  Which you have to decide on a level of risk

Share three scenarios in which you have to decide on a level of risk. These can be personal or professional, but you must be able to demonstrate your decision-making process.

  What is the bonds conversion ratio and straight-debt value

Preissle Company, wants to sell some 20-year, annual interest, $1,000 par value bonds. Its stock sells for $42 per share, and each bond would have 25 warrants attached to it, each exercisable into one share of stock at an exercise price of $47. The f..

  What is discounted payback period

A project has an initial cost of $8,800 and produces cash inflows of $2,700, $5,000, and $1,600 over the next three years, respectively. What is the discounted payback period if the required rate of return is 7 percent?

  Real output in an economy may be expressed as the ratio

Real output in an economy may be expressed as the ratio of _____________.

  What is the intrinsic value of stock

ABC Corp. has just paid a quarterly dividend of $0.28. ABC's dividends will grow by 5% for the next 4 quarters, and then grow by 0.6% thereafter. ABC has a quarterly required return of 4%. What is the intrinsic value of ABC stock?

  The machine will increase revenue

A machine costs $8 million and another $1 million to ship and modify. An increase of $2 million is needed for NOWC. the machine will increase revenue by $800,000 per year and will increase costs and expenses by $200,000 per year. The machine will be ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd