Which of the Following Statements Regarding Consolidated Financial Statements at the Date

question 43

Multiple Choice

Which of the following statements regarding consolidated financial statements at the date of acquistion is FALSE?

• A)At the day of acquisition, there is a need to prepare a consolidated statement of income.
• B)Regarding the equity accounts, only the parent's balances are carried into the consolidated statement of financial position.
• C)At acquisition date, all the equity of the subsidiary is pre-acquisition and eliminated.
• D)The assets and liabilities of the subsidiary are carried forward into the consolidated statement of financial position at fair value.

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Definitions:

Strict Performance

A legal principle that requires parties to a contract to fulfill their obligations exactly as specified in the contract, without deviation.

Substantial Performance

A legal concept indicating that if a party has performed enough of its contractual obligations, it may still enforce the contract despite minor breaches.

Uniform Commercial Code

A comprehensive set of laws that govern commercial transactions in the United States to standardize and simplify the legal process.

Insolvent Seller

A seller who cannot meet their financial liabilities as they become due.