When calculating the indirect non-controlling interest share of equity, consolidation adjustments are needed to:

Question

Quizplus · Accepted Answer

When calculating the indirect non-controlling interest share of equity, consolidation adjustments are needed to remove unrealised profits or losses from intragroup transactions. This helps to ensure that the financial statements reflect the economic reality of the company's operations, and prevent double-counting of profits or losses.

Therefore, option A is the correct choice. Option B is incorrect because profits made on intragroup services need to be eliminated, rather than recognised. Option C is incorrect because intragroup advances should be eliminated only if they are not expected to be settled in the foreseeable future. Option D is incorrect because profits on intragroup services should be fully eliminated, rather than partially eliminated.

When Calculating the Indirect Non-Controlling Interest Share of Equity, Consolidation