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Asked by Jenna Grace Milionis on Jun 12, 2024

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The measurement of the NCI allocation will be based on the subsidiary company's equity account balances.

NCI Allocation

Refers to the distribution of Net Current Assets among various parties or accounts, primarily focusing on how non-controlling interest (NCI) is allocated in consolidated financial statements.

Equity Account

An account that represents the owner's interest in a company's assets, typically reflecting the amount of funds that remain for the owners after all liabilities have been subtracted.

  • Attain an understanding of non-controlling interest (NCI) and its embodiment in consolidated financial statements.
  • Comprehend how NCI affects the measurement and reporting of equity in consolidated accounts.
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AB
Auriel BeattyJun 13, 2024
Final Answer :
True
Explanation :
According to current accounting standards, the NCI allocation is based on the subsidiary company's equity account balances. This is because NCI represents the portion of a subsidiary company's equity that is not owned by the parent company. Therefore, it makes sense to allocate NCI based on the equity account balances in order to accurately reflect the portion of the subsidiary's value that is attributable to NCI.

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