Select the Incorrect Statement from the Following

question 11

Multiple Choice

Select the incorrect statement from the following:

• A)Adjustments are required to eliminate any transactions between Parent and Sub (e.g., selling or other transfer of assets).
• B)Even when the parent owns less than 100% of the subsidiary's stock, 100% of the subsidiary's assets and liabilities are included in the consolidated balance sheet.
• C)Any consolidated net income attributable to minority interest must be clearly identified and shown on the consolidated income statement.
• D)Consolidated net income is equal to the sum of the parent's net income and the sub's net income.

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Definitions:

Payroll Tax

A tax imposed on employers and employees, calculated as a percentage of the salaries that employers pay their staff.

Marginal Tax

The additional tax paid on an additional dollar of income, used in progressive tax systems to tax higher incomes at higher rates.

Proportional

A relationship or ratio between two quantities where they change at the same rate.

Tax Rate

The proportion of income that a person or business must pay in taxes.