Z Company Acquired a Subsidiary Several Years Ago That Was

question 58

Multiple Choice

Z Company acquired a subsidiary several years ago that was appropriately excluded from consolidation last year. This year Z has consolidated the subsidiary in its financial statements. This results in:

• A) An accounting change that should be reported prospectively.
• B) A correction of an error.
• C) An accounting change that should be reported by restating the financial statements of all prior periods presented.
• D) Neither an accounting change nor a correction of an error.

---

Definitions:

Collectivist Cultures

Societies that prioritize collective goals over individual achievements, emphasizing community and social interconnectedness.

Individualist Cultures

Cultures that emphasize the importance of personal goals, autonomy, and individual achievement over group identity.

Group Judgment

The process of making decisions or forming opinions through consensus in a group, influenced by group dynamics and social factors.

Solomon Asch

A psychologist best known for his experiments in the 1950s on conformity, demonstrating the influence of group pressure on opinions.