Question
Parent company acquired 100% of voting rights common stock of subsidiary paying SR 500 Cash. Sub. Net income SR 100, dividends declared SR 50. What
Parent company acquired 100% of voting rights common stock of subsidiary paying SR 500 Cash. Sub. Net income SR 100, dividends declared SR 50. What is the journal entry parent passes using cost method?
a.
Dr. Investment account 100, Cr. income from subsidiary 100
b.
Dr. Dividends receivable 50, Cr. Investment account 50.
c.
Dr. income from subsidiary 100, Cr. Investment account 100
d.
Dr. Dividends receivable 50, Cr. income from subsidiary 50
Parent company acquired 100% of voting rights common stock of subsidiary paying SR 500 Cash. Sub. Net income SR 100, dividends declared SR 50. What is the journal entry parent passes using cost method?
a.
Dr. Investment account 100, Cr. income from subsidiary 100
b.
Dr. Dividends receivable 50, Cr. Investment account 50.
c.
Dr. income from subsidiary 100, Cr. Investment account 100
d.
Dr. Dividends receivable 50, Cr. income from subsidiary 50
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Accounting
Authors: Carl s. warren, James m. reeve, Philip e. fess
21st Edition
978-0324188004
