Change in parent’s ownership: the parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies. a subsidiary can change the parent’s ownership percentage by selling additional shares to or repurchase shares from unaffiliated parties. When parent sells a subsidiary share to non-affiliate a gain or loss normally occurs and is recorded on the seller’s books when a company disposes of all or part of an investment. ASC 323 deals explicitly with sales of stock of investee, requiring recognition of a gain or loss on the difference between the selling price and the carrying amount of the stock. To explain : how parent purchase of additional common shares of its subsidiary above the book value reflects in consolidated financial statements.

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Answer 1

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Chapter 9, Problem 9.7Q

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Change in parent’s ownership: the parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies. a subsidiary can change the parent’s ownership percentage by selling additional shares to or repurchase shares from unaffiliated parties. When parent sells a subsidiary share to non-affiliate a gain or loss normally occurs and is recorded on the seller’s books when a company disposes of all or part of an investment. ASC 323 deals explicitly with sales of stock of investee, requiring recognition of a gain or loss on the difference between the selling price and the carrying amount of the stock.

To explain : how parent purchase of additional common shares of its subsidiary above the book value reflects in consolidated financial statements.

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An error exists in a set of financial statements. The error is not pervasive, but material. The CPA can issue what type of report? Qualified Disclaimer Adversea. No No Yesb. Yes Yes Noc. No Yes Yesd. Yes No Yese. Yes No No

Answer 2

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Chapter 9, Problem 9.7Q

To determine

Change in parent’s ownership: the parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies. a subsidiary can change the parent’s ownership percentage by selling additional shares to or repurchase shares from unaffiliated parties. When parent sells a subsidiary share to non-affiliate a gain or loss normally occurs and is recorded on the seller’s books when a company disposes of all or part of an investment. ASC 323 deals explicitly with sales of stock of investee, requiring recognition of a gain or loss on the difference between the selling price and the carrying amount of the stock.

To explain : how parent purchase of additional common shares of its subsidiary above the book value reflects in consolidated financial statements.

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Answer 3

Question

Chapter 9, Problem 9.7Q

To determine

Change in parent’s ownership: the parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies. a subsidiary can change the parent’s ownership percentage by selling additional shares to or repurchase shares from unaffiliated parties. When parent sells a subsidiary share to non-affiliate a gain or loss normally occurs and is recorded on the seller’s books when a company disposes of all or part of an investment. ASC 323 deals explicitly with sales of stock of investee, requiring recognition of a gain or loss on the difference between the selling price and the carrying amount of the stock.

To explain : how parent purchase of additional common shares of its subsidiary above the book value reflects in consolidated financial statements.

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Answer 4

Question

Chapter 9, Problem 9.7Q

To determine

Change in parent’s ownership: the parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies. a subsidiary can change the parent’s ownership percentage by selling additional shares to or repurchase shares from unaffiliated parties. When parent sells a subsidiary share to non-affiliate a gain or loss normally occurs and is recorded on the seller’s books when a company disposes of all or part of an investment. ASC 323 deals explicitly with sales of stock of investee, requiring recognition of a gain or loss on the difference between the selling price and the carrying amount of the stock.

To explain : how parent purchase of additional common shares of its subsidiary above the book value reflects in consolidated financial statements.

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Answer 5

Chapter 9, Problem 9.7Q

To determine

Change in parent’s ownership: the parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies. a subsidiary can change the parent’s ownership percentage by selling additional shares to or repurchase shares from unaffiliated parties. When parent sells a subsidiary share to non-affiliate a gain or loss normally occurs and is recorded on the seller’s books when a company disposes of all or part of an investment. ASC 323 deals explicitly with sales of stock of investee, requiring recognition of a gain or loss on the difference between the selling price and the carrying amount of the stock.

To explain : how parent purchase of additional common shares of its subsidiary above the book value reflects in consolidated financial statements.

Answer 6

Chapter 9, Problem 9.7Q

To determine

Change in parent’s ownership: the parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies. a subsidiary can change the parent’s ownership percentage by selling additional shares to or repurchase shares from unaffiliated parties. When parent sells a subsidiary share to non-affiliate a gain or loss normally occurs and is recorded on the seller’s books when a company disposes of all or part of an investment. ASC 323 deals explicitly with sales of stock of investee, requiring recognition of a gain or loss on the difference between the selling price and the carrying amount of the stock.

To explain : how parent purchase of additional common shares of its subsidiary above the book value reflects in consolidated financial statements.

Answer 7

Chapter 9, Problem 9.7Q

To determine

Change in parent’s ownership: the parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies. a subsidiary can change the parent’s ownership percentage by selling additional shares to or repurchase shares from unaffiliated parties. When parent sells a subsidiary share to non-affiliate a gain or loss normally occurs and is recorded on the seller’s books when a company disposes of all or part of an investment. ASC 323 deals explicitly with sales of stock of investee, requiring recognition of a gain or loss on the difference between the selling price and the carrying amount of the stock.

To explain : how parent purchase of additional common shares of its subsidiary above the book value reflects in consolidated financial statements.

Answer 8

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Answer 9

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Answer 11

Ch. 9 - Prob. 9.1Q Ch. 9 - Prob. 9.2Q Ch. 9 - Prob. 9.3Q Ch. 9 - Prob. 9.4Q Ch. 9 - Prob. 9.5Q Ch. 9 - Prob. 9.6Q Ch. 9 - Prob. 9.7Q Ch. 9 - Prob. 9.8Q Ch. 9 - Prob. 9.9Q Ch. 9 - Prob. 9.10Q

Solution Summary: The author explains how parent company can change ownership ratio by purchasing or selling shares of the subsidiary in transaction with unaffiliated companies.

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