When Consolidating a Foreign Subsidiary, Which of the Following Statements

question 39

Multiple Choice

When consolidating a foreign subsidiary, which of the following statements is true?

• A) Parent reports a cumulative translation adjustment from adjusting its investment account under the equity method.
• B) Parent reports a gain or loss in net income from adjusting its investment account under the equity method.
• C) Subsidiary's cumulative translation adjustment is carried forward to the consolidated balance sheet.
• D) Subsidiary's income/loss is carried forward to the consolidated balance sheet.
• E) All foreign currency gains/losses are eliminated in the consolidated income statement and balance sheet.

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Definitions:

Nonrefundable Plane Ticket

A type of airline ticket that cannot be returned for a refund, typically offered at a lower price than refundable tickets.

Overnight Mail

Overnight mail is a shipping service that guarantees delivery of a package or letter to its destination by the next business day.

Loads of Laundry

Units or batches of clothing, linens, and other textiles laundered together in a single process.

Pages

Physical or digital sheets on which written or printed information is displayed; not a standard economic term.