Use the Following Information to Answer the Question(s) Below

question 8

Multiple Choice

Use the following information to answer the question(s) below.

In 2014, Parla Corporation sold land to its subsidiary, Sidd Corporation, for $38,000. It had a book value of $24,000. In the next year, Sidd sold the land for $41,000 to an unaffiliated firm.

-Which of the following is correct?

• A)No consolidation working paper entry is required for this transaction in 2014.
• B)A consolidation working paper entry is required only if the subsidiary was less than 100% owned in 2014.
• C)A consolidation working paper entry is required each year that Sidd has the land.
• D)A consolidation working paper entry was required only if the land was held for resale in 2014.

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Definitions:

Strategic Direction

The planned approach and set of actions that an organization intends to follow in order to achieve long-term goals and objectives.

Business Cycle

The fluctuations in economic activity that an economy experiences over time, characterized by periods of expansion and contraction.

Downward Trajectory

A trend or direction that is moving towards a lower position, level, or quality, often indicating a decline.

Human Touch

The element of personal interaction and empathy in dealings and relations, emphasizing the importance of human connection.