At Acquisition Date, a Wholly Owned Subsidiary Had the Following

question 39

Multiple Choice

At acquisition date, a wholly owned subsidiary had the following equity items: - Retained earnings $28 000
- Share capital $60 000
- Business combination revaluation reserve $12 000
In the year following the acquisition, the subsidiary transferred $20 000 from pre-acquisition retained earnings to a general reserve account. At the reporting date following the reserve transfer, the following consolidation adjustment is needed:

• A) DR Retained earnings $20 000 CR General reserve $20 000
• B) DR General reserve $20 000 CR Shares in subsidiary $20 000
• C) DR Shares in subsidiary $20 000 CR Retained earnings $20 000
• D) DR General reserve $20 000 CR Retained earnings $20 000

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Definitions:

Marginal Utility

The change in overall satisfaction derived from the consumption of an additional unit of a good.

Health Care Consumption

Encompasses the use of health care services, goods, and resources by individuals or communities.

Insurance

A financial product that provides protection against potential future losses or damages in exchange for a premium.

Medical Care Purchases

Transactions involving the acquisition of healthcare services and products.