A Parent Company Owns a 100% Interest in a Subsidiary

question 38

Multiple Choice

A parent company owns a 100% interest in a subsidiary.Recently, the subsidiary paid a 10% stock dividend.The dividend should be recorded on the books of the parent

• A)​at the par value or stated value of the shares received.
• B)​at the market value of the shares on the date of declaration.
• C)​at the market value of the shares on the date of distribution.
• D)​merely as a memo entry indicating that the cost of the original investment now is allocated to a greater number of shares.

---

Definitions:

Zygomaticus

A muscle of the face, which draws the angle of the mouth superiorly and posteriorly to allow for smiling.

Temporalis

A muscle located on the side of the skull that is involved in chewing and jaw movement.

Buccinator

A muscle of the cheek that helps in mastication by pushing food onto the molars and is also involved in facial expression.

Masseter

A facial muscle that plays a major role in the chewing of solid foods, one of the strongest muscles in the human body.