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Rakhi Vasavada
Rakhi Vasavada , Financial and Legal Consultant
Category: Finance
Satisfied Customers: 2535
Experience:  Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
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True or False The idea of consolidated statements is

Customer Question

True or False:



The idea of consolidated statements is to disregard the separate legal entity status of each company. _________

A general ledger is maintained for the consolidated reporting entity. _________

Under the equity method, the carrying value of the investment represents the market value of the common stock holding. _________

It may be necessary to consolidate a company in which a publicly owned investor company does not own a majority voting interest. _________

A subsidiary can be consolidated even if it has a different year-end than its parent company.

Consolidation entries are never posted to a general ledger. _________

A bargain purchase element exists when the cost of the acquisition is below the book value of the net assets. _________

A parent need not consolidate a created subsidiary that the parent is in the process of trying to sell. _________

When assets are acquired, the target company never makes any entries on its books as a result of the combination. _________

When the parent is not obligated to invest additional funds in a subsidiary that is reporting losses, the parent stops applying the equity method when the subsidiary’s equity becomes negative. _________

It is inappropriate to consolidate a subsidiary that has not yet become profitable. _________

Goodwill arises when the cost of the acquisition exceeds the current value of the net assets. _________

The equity method would not be used when the target company’s assets were acquired. ________

The only way to determine whether control exists is by determining whether a majority of the voting common stock is owned. _________

Goodwill must be amortized if management believes a diminishment of value has occurred. _________

Transactions between a parent and its subsidiaries must be eliminated in consolidation exactly as if the transactions had not occurred. _________
Submitted: 5 years ago.
Category: Finance
Expert:  Manal Elkhoshkhany replied 5 years ago.

Hello and welcome to JA

 

Please advise your deadline as well as the name of the book you are using: Title, author's name, and edition

 

Thank you

Customer: replied 5 years ago.

Deadline: July 5, 2010 1:00pm

 

Book

Advanced Accounting

Hoyle, Schaeffer, Doupnik

Ninth Edition

 

Customer: replied 5 years ago.
When will this be complete??