Which of the Following Adjustments (If Any) to Retained Earnings

question 31

Multiple Choice

Which of the following adjustments (if any) to Retained Earnings is necessary for the preparation of the consolidated balance sheet?

• A) Under both the Cost and Equity methods, the parent must record its share of its Subsidiary's income.
• B) Under both the Cost and Equity methods, the parent must record its share of its Subsidiary's income less any dividends received from the subsidiary.
• C) No adjustment is required under either the Cost or the Equity methods.
• D) No adjustment is required if the parent has been using the Equity Method.

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Definitions:

San Francisco

A major city in California, USA, known for its iconic Golden Gate Bridge, steep streets, and vibrant cultural and tech scene.

Great Plains

A vast high plateau of semiarid grassland that extends across much of North America, from the Mississippi River to the Rocky Mountains.

Major Obstacle

A significant barrier or hurdle that impedes progress or achievement in a particular endeavor or project.

Comanche

A Native American tribe historically known for their horseback riding skills and dominance over the Great Plains area.