Toyota Motor Corporation produces passenger car brands Lexus, Toyota, and Scion A recent annual report includes the statement that The consolidated financial statements include the accounts of the parent company and those of its majority owned subsidiary companies It then suggests that All signific...

Consolidation is an accounting process that brings together financial info ...

Toyota Motor Corporation produces passenger car brands Lexus, Toyota, and Scion. A recent annual report includes the

Question:

Toyota Motor produces passenger car brands Lexus, Toyota, and Scion. A recent annual report includes the statement that “The consolidated include the accounts of the parent company and those of its majority-owned subsidiary companies.” It then suggests that “All significant intercompany transactions and accounts have been eliminated.” In your own words, explain the meaning of this last statement. Why is it necessary to eliminate all intercompany accounts and transactions in consolidation?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...