At Acquisition Date, a Wholly Owned Subsidiary Had the Following $\quad$

question 49

Multiple Choice

At acquisition date, a wholly owned subsidiary had the following equity items. Retairled earmirgs $\quad$$\quad$$\$ 27,500$
BHare capital $\quad$$\quad$$\quad$$\$ 40,000$ In the year following the acquisition, the subsidiary transferred $5 000 from pre-acquisition retained earnings to a general reserve account. At the reporting date following the reserve transfer, which of the following consolidation adjustments is needed?
I. Dr Retained earnings $5 000
Cr General reserve $5 000
II. Dr General reserve $5 000
Cr Transfer to general reserve $5 000
III. Dr General reserve $5 000
Cr Shares in subsidiary $5 000
IV. Dr Shares in subsidiary $5 000
Cr Retained earnings $5 000

• A) I.
• B) II.
• C) III.
• D) IV.

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Definitions:

Sales Promotions

Short-term incentives to encourage the purchase or sale of a product or service, including discounts, coupons, contests, and free samples.

Media Cooperation

A collaborative effort among various media outlets to enhance information sharing and distribution.

Absolute Costs

The total expenses incurred in the manufacturing and distribution of a product, including materials, labor, and overhead.

Promotional Element

Components of the promotional mix used by a company to reach its marketing objectives, including advertising, sales promotion, personal selling, and public relations.