Consolidated Shareholders' Equity

question 67

Multiple Choice

Consolidated shareholders' equity:

• A) does not include any non-controlling Interest.
• B) is equal to the sum of the Shareholders' Equity Sections of the parent and the subsidiary.
• C) is equal to that of the parent company under the Equity Method.
• D) is higher under the Equity Method when the subsidiary does not declare dividends.

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Definitions:

Operating Income

Earnings before interest and taxes (EBIT), representing the profit from core business operations.

Contribution Format

Contribution format is an income statement format that separates costs into fixed and variable categories, highlighting the contribution margin of goods or services sold.

Contribution Margin

The amount by which sales revenue exceeds variable costs. It represents the portion of sales that helps to cover fixed costs.

Contribution Format

A type of income statement where costs are classified as variable or fixed, and the contribution margin is computed by subtracting total variable costs from sales.