When Preparing a Consolidated Balance Sheet Worksheet When the Investment

Multiple Choice

When preparing a consolidated balance sheet worksheet when the investment account is maintained under the simple equity method:

A) ​the parent's share of subsidiary income should be eliminated against retained earnings.
B) ​the parent's share of the subsidiary's equity accounts may be eliminated directly against the investment account.
C) ​any intercompany sales must be eliminated against cost of goods sold.
D) ​the investment account should be converted to the cost method as of the end of the year.