One Complication That Arises in Consolidation When the Parent and Subsidiary

question 25

Multiple Choice

One complication that arises in consolidation when the parent and subsidiary have filed separate tax returns is:​

• A)​timing differences are created in consolidation for items such as intercompany profits in inventory.
• B)​the parent and subsidiary may both incur taxes on the same items.
• C)​a special tax reserve must be set up in owners' equity.
• D)​None of the above.

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Definitions:

Mean Value

The average of a set of numbers, calculated by dividing the sum of all the numbers by the count of the numbers.

Mode

The mode, or the value with the highest frequency, in a set of numbers.

Males

Refers to the male gender or sex, typically used in studies or statistics to denote participants or subjects that are biologically male.

Females

Females refer to the sex of an organism, or a part of an organism, that produces non-mobile ova (egg cells) and can typically bear offspring or produce seed.