Questions from Financial Accounting

Q: Tear Company, a newly established subsidiary of Stern Corporation, received

Tear Company, a newly established subsidiary of Stern Corporation, received assets with an original cost of $260,000, a fair value of $200,000, and a book value of $140,000 from the parent in exchange...

Q: What means other than majority ownership might be used to gain control

What means other than majority ownership might be used to gain control over a company? Can consolidation occur if control is gained by other means?

Q: What must be done if the fiscal periods of the parent and

What must be done if the fiscal periods of the parent and its subsidiary are not the same?

Q: What is the difference between consolidated and combined financial statements?

What is the difference between consolidated and combined financial statements?

Q: How might consolidated statements help an investor assess the desirability of purchasing

How might consolidated statements help an investor assess the desirability of purchasing shares of the parent company?

Q: Are consolidated financial statements likely to be more useful to the owners

Are consolidated financial statements likely to be more useful to the owners of the parent company or to the noncontrolling owners of the subsidiaries? Why?

Q: What is meant by parent company? When is a company considered

What is meant by parent company? When is a company considered to be a parent?

Q: Are consolidated financial statements likely to be more useful to the creditors

Are consolidated financial statements likely to be more useful to the creditors of the parent company or the creditors of the subsidiaries? Why?

Q: Why is ownership of a majority of the common stock of another

Why is ownership of a majority of the common stock of another company considered important in consolidation?

Q: What major criteria must be met before a company is consolidated?

What major criteria must be met before a company is consolidated?