Answered: 4)explain what control consists of in…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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4)explain what control consists of in subsidiaries in multinational companies and discuss the differences between the types of direct and indirect controls

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Step 1 (Meaning)

A multinational company means a company having its operations in other countries as well. So, it forms many subsidiary companies to manage their operations. All companies are controlled by headquarters. Control can be referred to as the process used by the parent company to make decisions for the subsidiary company. A subsidiary company is obliged to follow its parent company.

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