Parent Sold Land to Its Subsidiary for a Gain in 2010

question 31

Multiple Choice

Parent sold land to its subsidiary for a gain in 2010. The subsidiary sold the land externally for a gain in 2013. Which of the following statements is true?

• A) A gain will be reported in the consolidated income statement in 2010.
• B) A gain will be reported in the consolidated income statement in 2013.
• C) No gain will be reported in the 2013 consolidated income statement.
• D) Only the parent company will report a gain in 2013.
• E) The subsidiary will report a gain in 2010.

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Definitions:

School Learning

A process that involves acquiring knowledge, skills, values, and attitudes within an educational institution.

Social-learning Approach

The social-learning approach is a theory in psychology that suggests individuals learn behaviors through observing others, imitating them, and seeing the consequences of these behaviors.

Imitation

The action of using someone or something as a model and attempting to replicate their behavior, actions, or features.

Vicarious Punishment

Learning that occurs when the likelihood of a behavior decreases after observing the negative consequences applied to another individual's behavior.