Which One of the Following Will Increase Consolidated Retained Earnings

question 44

Multiple Choice

Which one of the following will increase consolidated retained earnings?

• A)An increase in the value of goodwill associated with a subsidiary subsequent to the parent's date of acquisition
• B)The amortization of a $10,000 excess in the fair value of a note payable over its recorded book value
• C)The depreciation of a $10,000 excess in the fair value of equipment over its recorded book value
• D)The sale of inventory by a subsidiary that had a $10,000 excess in fair value over recorded book value on the parent's date of acquisition

Comprehend how partners in a partnership are taxed.

Identify and differentiate between various types of partnerships and the legal implications for each.

Learn the process and implications of a partner's withdrawal or addition in a partnership.

Understand the concept of mutual agency within a partnership.

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Definitions:

Raw Materials

Basic materials that are used in the production process to manufacture goods, often transformed into final products or component parts.

Production

The process of creating goods and services, involving both the conversion of raw materials into finished products and the creation of value.

Year Ended

The conclusion of a 12-month accounting period, at which financial statements are prepared to summarize the year's transactions.

Direct Materials Used

The cost of raw materials that are directly involved in the production of goods.