Which of the Following Are Other Issues to Consider in the Preparation

question 18

Multiple Choice

Which of the following are other issues to consider in the preparation of the consolidated financial statements?
I. when a parent acquires a subsidiary after that subsidiary has acquired its own subsidiary.
II. when the parent changes its ownership interest in a subsidiary after the consolidation group has been formed.
III. where the parent has control over two subsidiaries but only has an ownership interest in one of those subsidiaries.

• A) I, II and III
• B) I and II only
• C) II and III only
• D) I and III only

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Definitions:

Financial Statement

A formal record of the financial activities and position of a business, person, or other entity.

Permanent/Temporary

distinguishes between accounts or actions that exist indefinitely (permanent) or for a specific duration (temporary).

Closing Entries

Closing entries are journal entries made at the end of an accounting period to transfer temporary accounts to permanent accounts, preparing the books for the next period.

Worksheet Income Statement

is a financial statement that preliminarily combines income and expenses data in worksheet form to calculate net income or loss.