A Parent Company Regularly Sells Merchandise to Its 70%-Owned Subsidiary

question 23

Multiple Choice

A parent company regularly sells merchandise to its 70%-owned subsidiary.Which of the following statements describes the computation of noncontrolling interest share?

• A)The subsidiary's net income times 30%
• B)(The subsidiary's net income × 30%)+ unrealized profits in the beginning inventory - unrealized profits in the ending inventory
• C)(The subsidiary's net income + unrealized profits in the beginning inventory - unrealized profits in the ending inventory)× 30%
• D)(The subsidiary's net income + unrealized profits in the ending inventory - unrealized profits in the beginning inventory)× 30%

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Definitions:

Comparator

In general terms, a device or system that compares two items or signals and determines their relationship or difference.

Intended Movements

Movements that are planned or decided upon before they are executed, involving cognitive processes.

Sensory Stimuli

External or internal factors that can elicit a response from sensory organs, leading to a sensation.

Red Nucleus

A structure located in the rostral midbrain involved in motor coordination.