If a Firm Consolidates Subsidiaries That Are Not Wholly Owned,an

question 14

Multiple Choice

If a firm consolidates subsidiaries that are not wholly owned,an income statement item is created that is termed:

• A)dividend income.
• B)minority share of earnings.
• C)equity income.
• D)extraordinary.
• E)gain from sale of subsidiary.

---

Definitions:

Average Variable Cost

The total variable costs of production divided by the quantity of output produced, indicating the cost of producing one more unit of a good or service.

ATC

The average total cost is defined as the total production cost divided by the quantity of produced output.

AVC

Average Variable Cost, which is the cost of labor, materials, or overhead that changes according to the level of production output.

MC

Marginal cost, the increase in total cost that arises from an extra unit of production, important for decision-making in production and pricing.