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NEW QUESTION: 1
Viper Motor Company, a publicly traded automobile manufacturer located in Detroit, Michigan, periodically invests its excess cash in low-risk fixed income securities. At the end of 2009, Viper's investment portfolio consisted of two separate bond investments: Pinto Corporation and Vega Incorporated.
On January 2, 2009, Viper purchased $10 million of Pinto's 4% annual coupon bonds at 92% of par. The bonds were priced to yield 5%. Viper intends to hold the bonds to maturity. At the end of 2009, the bonds had a fair value of $9.6 million.
On July I, 2009, Viper purchased $7 million of Vega's 5% semi-annual coupon mortgage bonds at par. The bonds mature in 20 years. At the end of 2009, the market rate of interest for similar bonds was 4%. Viper intends to sell the securities in the near term in order to profit from expected interest rate declines.
Neither of the bond investments was sold by Viper in 2009.
On January 1,2010, Viper purchased a 60% controlling interest in Gremlin Corporation for $900 million.
Viper paid for the acquisition with shares of its common stock.
Exhibit 1 contains Viper's and Gremlin's pre-acquisition balance sheet data.
Exhibit 2 contains selected information from Viper's financial statement footnotes.
Using only the information contained in Exhibit 2, which of the following statements is most correct when presenting Viper's consolidated income statement for the year ended 2010?
A. An impairment loss of $5 million should be recognized under IFRS.
B. An impairment loss of $275 million should be recognized under U.S. GAAP.
C. No impairment loss is recognized under U.S. GAAP or IFRS.
Answer: C
Explanation:
Explanation/Reference:
Explanation:
According to U.S. GAAP, the goodwill is not impaired since the $1,475 million fair value of Gremlin exceeds the $1,425 million carrying value. Thus, no impairment loss is recognized.
Under IFRS, no impairment loss is recognized since the $1,430 million recoverable amount exceeds the
$1,425 million carrying value. (Study Session 5, LOS 21.b)
NEW QUESTION: 2
Which committee of IFAC issues pronouncements aimed at developing and harmonizing public sector financial reporting, accounting, and auditing practices while "Public sector" refers to national governments, regional (state, provincial, territorial) governments, local (city, town) governments, and related governmental entities (agencies, boards, commissions, and enterprises)?
A. Ethic's committee
B. general rules and regulation committee
C. Advisory committee
D. Public Sector Committee (PSC)
Answer: D
NEW QUESTION: 3
The company is implementing XenDesktop globally for desktop virtualization.
Why should an architect recommend multiple controllers in each datacenter?
A. To ensure that new desktop and application sessions can be launched
B. To protect against controller database failure
C. To protect users from WAN link failure
D. To enable users to maintain uninterrupted connection to their desktops
Answer: A
NEW QUESTION: 4
Which statement is correct regarding ProfiNET communication classes?
A. ProfiNET-NRT is prioritized as Layer-2 Class-of-Service 1 (CoS 1)
B. ProfiNET-NRT is used to carry time critical status information
C. ProfiNET-IRT requires switches with hardware time scheduling capabilities
D. ProfiNET-RT traffic is carried in UDP and TCP packets
Answer: C
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