Which of the Following Stockholders Equity Accounts Are Eliminated During

question 49

Multiple Choice

Which of the following stockholders equity accounts are eliminated during the consolidation process?

• A) Common Stock of the subsidiary
• B) Preferred Stock of the subsidiary
• C) Additional Paid-in Capital of the subsidiary
• D) All of the above

---

Definitions:

Cost Structure

The composition of a company’s costs, including fixed and variable costs, which impacts its profitability and pricing strategy.

Variable

A variable is an element, feature, or factor that is liable to vary or change; in business, it often refers to costs that fluctuate with the level of production or sales.

Fixed

Pertains to costs that remain constant regardless of the level of production or sales, such as rent, salaries, and insurance.

Fixed Costs

Costs that remain constant regardless of the amount of goods produced or sold within a specific timeframe, including rent, salaries, and insurance premiums.