Consolidated financial statements are typically prepared
when one company has a controlling financial interest in
another - UNLESS?

Question

_

a. The subsidiary is a finance company.

b. The fiscal year-ends of the two companies are morethan three months apart.

c. The investee is in bankruptcy.

d. The two companies are in unrelated industries, such asmanufacturing and real estate.

Sohail Lone · Answer

C) Correct Answer.The Investee is in Bankcruptcy

Deleted user · Answer

Answer C is the right option .

mohamed Hakim CMA CPA Candidate · Answer

dears thanks for answers

answer is : (c) A subsidiary should not be consolidated when

it is in bankruptcy. Consolidation of all majority-owned

subsidiaries is required regardless of the industry or business

of the subsidiary. A difference in fiscal periods of a parent

and a subsidiary does not of itself justify the exclusion of the

subsidiary from consolidation.

from Wiley CPA Study Guide

page Question7

ASC SFAS , Business Combination and Consolidation

حسين محمد ياسين · Answer

agree with answer C >>>>>>>>>>>>>>>>>>>>>>>>>>>>

Prashanth thangallapalli · Answer

The investee is in bankruptcy

Vibhanshu Jindal · Answer

Till the subsidiary company that is investee becomes bankrupt.

Ahmed kandil · Answer

answer C is the correct answer

thanks

Khaled Mohee Eldeen Abbas Mahmoud · Answer

d. The two companies are in unrelated industries, such as manufacturing and real estate.

Sanni Musa · Answer

The subsidiary is a finance company.

Mohammed Thufail · Answer

b. The fiscal year-ends of the two companies are morethan three months apart.

Charles Abdulkarim, CPA · Answer

Not required to consolidate when the parent company's business operation are considerably different than that of it subsidiary.