The Difference Between the Carrying Value of the Parent's Investment

question 44

Multiple Choice

The difference between the carrying value of the parent's investment in subsidiary and the amount received is treated as a gain or loss in the:

• A) parent's income statement
• B) subsidiary's revenue statement
• C) parent's financial statement
• D) subsidiary's income statement

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Definitions:

Check-Collection

The process of receiving and processing checks to obtain payment from the banking institutions on which they are drawn.

Disclaimed

Refused to acknowledge or accept something, especially legal claims or responsibility.

Warranty Liability

The legal obligation of a seller or manufacturer to repair, replace, or compensate for a defective product within a specified time period.

Negotiation

A process of discussion aimed at reaching an agreement between two or more parties.