All of the Following Statements About a Consolidated Group of Companies

question 35

Multiple Choice

All of the following statements about a consolidated group of companies are true, except:

• A)the financial statements include all of the assets and liabilities of the parent and all the subsidiary companies.
• B)each company is a separate legal entity.
• C)the group files a single tax return.
• D)the consolidated group is an accounting creation.

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Definitions:

Spot Bonus

An unplanned bonus given for employee effort unrelated to an established performance measure.

Performance Standard

The expected level of performance set by an organization against which employee output or accomplishments can be measured.

Culture of Ownership

An organizational environment where employees feel psychologically part of the company, fostering responsibility, engagement, and innovation.

Employee Stock Ownership Plans

An employee benefit plan giving workers ownership interest in the company, often as a form of retirement plan.