The Eliminations and Adjustment Entries Necessary to Consolidate the Parent

question 42

Multiple Choice

The eliminations and adjustment entries necessary to consolidate the parent and subsidiary financial statements are translated as follows:

• A) all balances, profits, and losses at the current exchange rate on the consolidation date
• B) intercompany balances translate at the rates used for other accounts, profits and losses translate at an average rate
• C) Intercompany balances translate at the current rates, profits and losses translate at an average rate
• D) none of the above are correct

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Definitions:

Infatuation

A state of intense, often short-lived passion or admiration for someone or something.

Empty Love

A type of love characterized by commitment without intimacy or passion, often found in relationships that have endured beyond the dissolution of physical and emotional connections.

Groupthink

Kind of thinking that occurs when people place more importance on maintaining group cohesiveness than on assessing the facts of the problem with which the group is concerned.

Challenger Disaster

A catastrophic event when the Space Shuttle Challenger broke apart shortly after liftoff on January 28, 1986, leading to the deaths of all seven crew members.