Reference no: EM132824707

Problem 1: an entity need not apply equity method to its investment in associate under which of the following

a. the entity is a parent that is exempted from preparing consolidated financial statements

b. when the investment meets the criteria to be classified as held for sale

c. when the investment is held by or is held indirectly through an entity that is a venture capital organization or a mutual fund unit trust and similar entities including investment linked insurance funds

d. in any of the choices

Problem 2: which of the following best describes past service cost under the defined benefit plan?

a. It is part of the service cost of a defined benefit plan of an entity

b. it is the increase in the present value of the defined benefit obligation arising from employee service in the current and prior period.

c. It is debited to an equity account to represent an expense arising from plan amendment

d. it is not present if the defined benefit plan of an entity has a surplus