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What are the reporting options for the investment in xyz

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Reference no: EM132827970

Problem 1: ABC Inc. holds 17% of the common shares of XYZ Ltd. ABC is able to appoint three members of XYZ's 12-member Board of Directors. ABC is also a supplier of raw materials to XYZ. XYZ is a private company and the remaining 83% of XYZ's common shares are widely held. Assume that ABC reports under ASPE, what are the reporting options for its investment in XYZ?

A. Equity method
B. Equity method or cost
C. Equity method, cost, or consolidation
D. Fair value through profit or loss (FVTPL) or cost.

Problem 2: Which of the following must be possible in order for a business combination to exist?

A. Ownership of 100 % of a subsidiary's voting shares
B. Control of a subsidiary's net assets that constitute a business
C. Ownership of all of a subsidiary's assets
D. Ownership of all of a subsidiary's operating assets

Reference no: EM132827970

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