In Calculating the Non-Controlling Interest in Earnings, What Is One

question 39

Multiple Choice

In calculating the non-controlling interest in earnings, what is one of the adjustments that must be made to the subsidiary's separate-entity earnings before the NCI percentage can be applied?

• A)Adjust for only realized profits from upstream sales.
• B)Adjust for only unrealized profits from upstream sales.
• C)Adjust for both realized and unrealized profits from upstream sales.
• D)Adjust for both realized and unrealized profits from downstream sales.

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Definitions:

Cost Of Goods Sold

Costs directly connected to the production of a company's sold merchandise.

Cost Of Goods Purchased

The total expense incurred to buy goods over a period, including transportation and handling, not yet necessarily sold.

Net Purchases

Net purchases refer to the total cost of purchases after adjusting for returns, allowances, and discounts over a specific period.

Cost Of Goods Available For Sale

The total cost of inventory available to be sold during a given period, including both beginning inventory and purchases made.