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When Using the Acquisition Method for Accounting for Business Combinations,all

Question 7

Multiple Choice

When using the acquisition method for accounting for business combinations,all of the following statements are false regarding the sale of subsidiary shares except:


A) If control ceases to exist and significant influence ceases to exist,the difference between selling price and acquisition value is recorded as a realized gain or loss
B) If control ceases to exist and significant influence ceases to exist,the difference between selling price and acquisition value is recorded as an unrealized gain or loss
C) If control ceases to exist and significant influence ceases to exist,the difference between selling price and carrying value is recorded as a realized gain or loss
D) If control ceases to exist and significant influence ceases to exist,the difference between selling price and carrying value is recorded as an unrealized gain or loss
E) If control ceases to exist and significant influence ceases to exist,the difference between selling price and carrying value is recorded as an adjustment to retained earnings

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