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Dithers Inc

question 39

Essay

Dithers Inc. acquired all of the common stock of Bumstead Corp. on January 1, 2011. During 2011, Bumstead sold land to Dithers at a gain. No consolidation entry for the sale of the land was made at the end of 2011. What errors will this omission cause in the consolidated financial statements?


Definitions:

Health-Care Coverage

A contract by which an insurance company agrees to cover part or all of a person's medical expenses in exchange for a premium.

Fair Labor Standards Act

U.S. legislation that creates the right to a minimum wage, and "time-and-a-half" overtime pay when people work over forty hours a week. It also prohibits most employment of minors in "oppressive child labor".

Hazardous Occupation

A job or profession that poses significant risks to the safety and health of the workers.

Health-Care Coverage

A type of insurance that pays for medical and surgical expenses incurred by the insured, helping to cover health care costs.

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