A Parent Company's Equity Interest in a Subsidiary May Change

question 5

Essay

A parent company's equity interest in a subsidiary may change as the result of the issuance of additional shares of stock by the subsidiary. Describe the effect on the parent's investment account when the new shares are (a) purchased ratably by the parent and noncontrolling shareholders or (b) entirely by the noncontrolling shareholders.

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Definitions:

Personality

A person’s usual pattern of behavior, feelings, and thoughts across time or across situations.

National Character

The perceived unique collective personality, customs, and traits of the citizens of a nation.

Perceptions

Refers to the process of organizing, identifying, and interpreting sensory information to represent and understand the environment.

Stereotype

A fixed, overgeneralized belief about a particular group or class of people.