A Subsidiary Issues Bonds

question 45

Essay

A subsidiary issues bonds.The parent can then acquire the bonds either directly from the subsidiary or from a nonaffiliate that had originally acquired the subsidiary's bonds.
Required:
a)Discuss the parent's accounting as it relates to the preparation of consolidated financial statements,for their acquisition of the bonds:
1.from the nonaffiliate.
2.directly from the subsidiary.
b)Why does it matter who the bonds are acquired from?

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Definitions:

Energy Flow

The transfer and transformation of energy through an ecosystem, from primary producers to various levels of consumers and decomposers.

Net Primary Productivity

The rate at which plants and other photosynthetic organisms produce organic compounds in an ecosystem minus the rate at which they use some of these compounds for cellular respiration.

Biomass

Organic material derived from living or recently living organisms, used as a source of energy or in various industrial processes.

Food Web

A network of interlinked food chains in an ecosystem, showing how each organism is food for the next level.