Dupuis Ltd

question 20

Multiple Choice

Dupuis Ltd. acquired Waul Ltd. through an exchange of shares. How should Waul record this on its books?

• A)Waul should debit an "Investment by Dupuis" account and credit its share capital account.
• B)Waul should debit an "Investment by Dupuis" account and remove all its asset and liability accounts.
• C)Waul should close all its balance sheet accounts.
• D)No entry should be made.

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Definitions:

Posting

The process of recording financial transactions in the accounting books, such as a ledger or journal.

Source Documents

Original records that contain the details necessary to support the transactions entered in an accounting system, such as invoices, receipts, or contracts.