The Usual Impetus for Transactions That Create a Long-Term Debtor-Creditor

question 16

Multiple Choice

The usual impetus for transactions that create a long-term debtor-creditor relationship between members of a consolidated group is due to the:​

• A)​subsidiary's ability to borrow larger amounts of capital at more favorable terms than would be available to the parent.
• B)​parent's ability to borrow larger amounts of capital at more favorable terms than would be available to the subsidiary.
• C)​parent's desire to decentralize asset management and credit control.
• D)​parent's desire to eliminate long-term debt.

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