When a Parent Purchases a Portion of the Newly Issued

question 40

Multiple Choice

When a parent purchases a portion of the newly issued stock of its subsidiary and the parent's percentage of ownership interest remains the same,

• A)​any difference between the change in equity and the price paid is the excess of cost or book value attributable to the new block.
• B)​any difference between the change in equity and the price paid is viewed as a gain or loss on the sale of an interest.
• C)​any difference between the change in equity and the price paid is viewed as a change in paid-in capital or retained earnings.
• D)​there will be no adjustment to parent's paid-in capital

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Definitions:

Schedule

A plan for carrying out a process or procedure, giving lists of intended events and times.

Routinely Late

A habitual pattern of being delayed or not arriving on time for appointments, work, or other scheduled activities.

Reprimand

To express to someone strong disapproval or criticism of their actions.

Inconsiderate

Describing behavior or actions that show a lack of concern for the needs, feelings, or well-being of others.