Which of the Following Statements Is True Regarding the Sale

question 1

Multiple Choice

Which of the following statements is true regarding the sale of subsidiary shares when using the acquisition method for accounting for business combinations?

• A) If control continues, the difference between selling price and acquisition value is recorded as a realized gain or loss.
• B) If control continues, the difference between selling price and acquisition value is an unrealized gain or loss.
• C) If control continues, the difference between selling price and carrying value is recorded as an adjustment to additional paid-in capital.
• D) If control continues, the difference between selling price and carrying value is recorded as a realized gain or loss.
• E) If control continues, the difference between selling price and carrying value is recorded as an adjustment to retained earnings.

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Definitions:

Cycle Times

The total time from the beginning to the end of your process, as defined by you and your customer, which could include production and processing time.

Assembly Line

A production method that breaks down a complex job into a series of smaller tasks, which are completed in a sequential order.

Task Times

The duration required to complete a specific task or activity within a process or project.