Which of the Following Statements Is False Regarding Multiple Acquisitions

question 76

Multiple Choice

Which of the following statements is false regarding multiple acquisitions of a subsidiary's existing common stock?

• A) The parent recognizes a larger percent of subsidiary income.
• B) A step acquisition resulting in control may result in a parent recognizing a gain on revaluation.
• C) The book value of the subsidiary will increase.
• D) The parent's percent ownership in subsidiary will increase.
• E) Noncontrolling interest in subsidiary's net income will decrease.

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Definitions:

Shared Goals

Objectives or aims that are pursued by more than one person or group, often leading to cooperation in efforts to achieve the outcome.

Cooperation

The process of groups working or acting together for a common purpose or benefit.

Projection

A psychological defense mechanism where an individual attributes their own unacceptable thoughts, feelings, or motives to another.

Competition

The rivalry among businesses or individuals for clients, market share, or achievement in a field, often driving innovation and improvements.