When the Parent Company Sells a Portion of Its Investment

question 12

Multiple Choice

When the parent company sells a portion of its investment in a subsidiary, the workpaper entry to adjust for the current year's income sold to noncontrolling stockholders includes a:

• A) debit to Subsidiary Income Sold.
• B) debit to Equity in Subsidiary Income.
• C) credit to Equity in Subsidiary Income.
• D) credit to Subsidiary Income Sold.

Analyze the impact of monetary and fiscal policies on inflation and unemployment.

Identify the effects of supply shocks on the economy's output, inflation, and the Phillips curve.

Grasp the concept of the short-run and long-run Phillips curves and their implications for monetary policy.

Recognize the role of expectations in influencing the unemployment and inflation outcomes.

---

Definitions:

Par Value

The nominal value of a bond, stock, or other security, as stated by the issuer upon issuance.

Discount

A reduction applied to the usual cost of goods, services, or invoices, often to encourage prompt payment or increase sales.

Preferred Stock

A type of stock that grants holders priority dividends, often with fixed rates, and preferential treatment in the event of liquidation over common stockholders.

Par Value

The face value of a bond or stock as stated by the issuer, which bears no relation to its market value.