Which of the Following Statements Is Correct

question 12

Multiple Choice

Which of the following statements is correct?

• A)a parent entity can hold only direct ownership interests in a subsidiary
• B)a parent entity can hold only indirect ownership interests in a subsidiary
• C)a parent entity cannot control a subsidiary if its shareholding is less than 50%
• D)a parent entity can hold both direct and indirect ownership interests in a subsidiary

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Definitions:

Posting

The process of transferring journal entry information to the ledger, ensuring every debit and credit transaction is recorded in the correct accounts.

Transposition Error

A mistake that occurs when two digits within a number are inadvertently reversed during data entry or recording.

Journal Entry

A record of a financial transaction in the accounting books.

Trial Balance

A bookkeeping worksheet where the balances of all ledgers are compiled into debit and credit account columns to check the accuracy of the financial transactions recorded.