When a Subsidiary Declares a Final Dividend Payable to a Parent

question 1

Multiple Choice

When a subsidiary declares a final dividend payable to a parent who has a 100% interest in the subsidiary the parent recognises a dividend receivable and the subsidiary recognises a dividend payable. In addition to the elimination of these two items on consolidation, the following items must also be eliminated:

• A) Dividend declared and Retained earnings
• B) Dividend declared and Dividend revenue
• C) Dividend revenue and Cash
• D) Dividend declared and Cash.

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Definitions:

Tracheoesophageal Fistula

An abnormal connection (fistula) between the trachea and the esophagus, which can lead to breathing and feeding difficulties and often requires surgical correction.

Replogle Tube

A dual-lumen tube used primarily in neonates for gastric decompression and to remove gastric secretions.

Gastrostomy Tube

A tube inserted through the abdomen into the stomach for feeding or drainage.

Pyloric Stenosis

A condition in infants causing severe vomiting due to the narrowing of the passage from the stomach to the small intestine.