Which of the Following Statements Is False Regarding Multiple Acquisitions

question 76

Multiple Choice

Which of the following statements is false regarding multiple acquisitions of a subsidiary's existing common stock?

• A) The parent recognizes a larger percent of subsidiary income.
• B) A step acquisition resulting in control may result in a parent recognizing a gain on revaluation.
• C) The book value of the subsidiary will increase.
• D) The parent's percent ownership in subsidiary will increase.
• E) Noncontrolling interest in subsidiary's net income will decrease.

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Definitions:

Principle of Comity

A doctrine in international law where countries mutually recognize and enforce each other's laws and judicial decisions out of respect, rather than obligation.

Act of State Doctrine

A principle in international law that allows a country to disregard foreign judgments that violate its own nation's sovereignty.

Space Resources

Natural materials found outside of Earth's atmosphere that can be extracted and utilized, such as water ice on the moon or minerals on asteroids.

Antidumping Duty

A tariff imposed by a government on foreign imports believed to be priced below fair market value to protect domestic industries.