Large,global enterprises typically have an equity interest in other entities throughout the world.Some of the interests represent wholly-owned (100%-owned)subsidiaries,while others represent lesser percentages of ownership.These large global conglomerates provide information on the percentage ownership of their various affiliated companies in the notes to the consolidated financial statements.
The following list of companies represents the ownership percentage of selected companies by a large global company:
Required:
Explain how you would expect the global company holding the indicated interests to account for each of the companies listed above,based on the percentage ownership reported.
Definitions:
Market Demand Curve
A graphical representation showing the quantity of a good that all consumers in a market are willing to purchase at various prices.
Public Good
A product or service that is made available to all members of a society by the government or a private entity, characterized by non-excludability and non-rivalry in consumption.
Marginal Cost
The increment in production cost when an extra unit of a product or service is produced.
Optimal Number
The best or most favorable amount of something in terms of efficiency or success.
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