1 Groups and consolidation: an overview

ANSWERS TO QUICK QUIZ 
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PART G: PREPARING SIMPLE CONSOLIDATED FINANCIAL STATEMENTS 
 
442
 
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443 
C H A P T E R 
TOPIC LIST 
SYLLABUS 
REFERENCE 
1 Introduction to the consolidated statement of profit or loss 
G1(e)
2 Intra-group trading
G1(e)
3 Acquisitions part way through the year 
G1(e)
4 Summary: consolidated statement of profit or loss 
G1(e)
The consolidated 
statement of profit 
or loss 
This chapter introduces the basic procedures required to produce a 
consolidated statement of profit or loss.
We begin by looking at a basic consolidated statement of profit or 
loss, including the impact of a non-controlling interest. We then 
move on to look at the effects of intra-group trading and 
acquisitions of subsidiaries part way through the year.
There are plenty of questions and examples in this chapter – work 
through 
all
of them carefully. 
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PART G: PREPARING SIMPLE CONSOLIDATED FINANCIAL STATEMENTS 
 
444
 
Study Guide 
Intellectual level
G Preparing simple consolidated financial statements 
1 Subsidiaries 
(e) Describe the components of and prepare a consolidated 
statement of profit or loss or extracts thereof, including:
(i) Elimination of intra-group trading balances (excluding 
cash and goods in transit) 
(ii) Removal of unrealised profit arising on intra-group 
trading 
(iii) Acquisition of subsidiaries part way through the financial 
year 
S