Which of the Following Statements Is True Regarding the Subsidiary's

question 58

Multiple Choice

Which of the following statements is true regarding the subsidiary's investment in its parent's common stock?

• A) All of the parent company's common stock is eliminated.
• B) The consolidation worksheet entry to eliminate the subsidiary's investment in parent's common stock is debited to treasury stock.
• C) The consolidation worksheet entry to eliminate the subsidiary's investment in parent's common stock is debited to retained earnings.
• D) The consolidation worksheet entry to eliminate the subsidiary's investment in parent's common stock is debited to additional paid-in capital.
• E) The investment in parent company's common stock is not eliminated in consolidation.