A parent company owns 80% of the issued capital of its subsidiary. On consolidation, a sale of inventories between parent and subsidiary will be eliminated as follows Select one: A. 20% of the sale amount B. 80% of the sale amount C. 100% of the sale amount D. not eliminated

A parent company owns 80% of the issued capital of its subsidiary. On consolidation, a sale of inventories between parent and subsidiary will be eliminated as follows Select one: A. 20% of the sale amount B. 80% of the sale amount C. 100% of the sale amount D. not eliminated

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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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

A parent company owns 80% of the issued capital of its subsidiary. On consolidation, a sale of inventories between parent and subsidiary will be eliminated as follows

Select one:

A. 20% of the sale amount

B. 80% of the sale amount

C. 100% of the sale amount

D. not eliminated

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