A Plc Owns 85% of the Issued Capital of B

question 27

Multiple Choice

A Plc owns 85% of the issued capital of B Plc and B Plc owns 90% of the issued capital of C Plc.What is the total outside equity interest in C Plc?

• A)23.5%
• B)10%
• C)13.5%
• D)15%

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Definitions:

Interest

The cost of borrowing money, often expressed as a percentage rate over a period of time, or the income earned from lending money.

Dividends

Money disbursed by a business to its members, principally originating from the enterprise's earnings.

Financial Intermediary

An institution that pools investors’ money and invests it on their behalf giving the investors shares of itself. Mutual funds are the primary example.

Indirect Method

A way of calculating cash flows from operations by starting with net income and adjusting for changes in non-cash accounts.