At Acquisition Date, a Wholly Owned Subsidiary Had the Following

Multiple Choice

At acquisition date, a wholly owned subsidiary had the following equity items: - Retained earnings $28 000
- Share capital $60 000
- Business combination revaluation reserve $12 000
In the year following the acquisition, the subsidiary transferred $20 000 from pre-acquisition retained earnings to a general reserve account. At the reporting date following the reserve transfer, the following consolidation adjustment is needed:

A) DR Retained earnings $20 000 CR General reserve $20 000
B) DR General reserve $20 000 CR Shares in subsidiary $20 000
C) DR Shares in subsidiary $20 000 CR Retained earnings $20 000
D) DR General reserve $20 000 CR Retained earnings $20 000