What is the basic idea underlying the preparation of consolidated financial statements?

Concept Introduction:
Consolidation:The consolidation financial statements are the one which is prepared for providing a consolidated view of financials of the company having subsidiary companies. Consolidation can take place either by acquisition or purchase of voting stock or by merger.
The basic idea of underlying the preparation of consolidated financial statement.
Explanation of Solution
As per the new Companies Act 2013, all listed or unlisted companies having one or more subsidiary including joint venture, associate company are required to prepare consolidated financial statement along with their standalone financial statement for every financial year.
The basic idea for preparing the consolidated financial statements is that the financial position of the parent company and it’s all subsidiaries can be determined and the end results of the operations of both the companies can be ascertained. This is done on the basis of that the companies are working as a single unit.
Want to see more full solutions like this?
Chapter 3 Solutions
ADVANCED FIN. ACCT. LL W/ACCESS>CUSTOM<
- Please provide the accurate answer to this general accounting problem using valid techniques.arrow_forwardCan you solve this general accounting problem using accurate calculation methods?arrow_forwardEdvard Technologies sells premium headphones. The unit selling price is $85, the unit variable costs are $37.25, fixed costs are $175,000, and current sales are 12,000 units. How much will operating income change if sales increase by 4,500 units?arrow_forward
- Novak Inc. sells one product, its waterproof camping tent. It began operations in the current year and had an ending inventory of 6,200 units. The company sold 18,500 units throughout the year. Fixed manufacturing overhead is $9 per unit, and total manufacturing cost per unit is $31.75 (including fixed manufacturing overhead costs). What is the difference in net income between absorption and variable costing?arrow_forwardProvide Answerarrow_forwardCan you provide the accurate answer to this financial accounting question using correct methods?arrow_forward
- I am looking for a reliable way to solve this financial accounting problem using accurate principles.arrow_forwardWestfield Retail Store had a balance in the Accounts Receivable account of $380,000 at the beginning of the year and a balance of $420,000 at the end of the year. Net credit sales during the year amounted to $2,800,000. The average collection period of the receivables in terms of days was___. (Round your answer to nearest number)arrow_forwardSolve this question and accounting questionarrow_forward
- Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College PubAuditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage LearningIntermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning
- Auditing: A Risk Based-Approach to Conducting a Q...AccountingISBN:9781305080577Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:South-Western College PubCollege Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,EBK CONTEMPORARY FINANCIAL MANAGEMENTFinanceISBN:9781337514835Author:MOYERPublisher:CENGAGE LEARNING - CONSIGNMENT





