Consolidated financial statements are designed to provide:
A)informative information to all shareholders.
B)the results of operations, cash flow, and the balance sheet in an understandable and informative manner for creditors.
C)the results of operations, cash flow, and the balance sheet as if the parent and subsidiary were a single entity.
D)subsidiary information for the subsidiary shareholders.

Question

Consolidated financial statements are designed to provide:
A)​informative information to all shareholders.
B)​the results of operations, cash flow, and the balance sheet in an understandable and informative manner for creditors.
C)​the results of operations, cash flow, and the balance sheet as if the parent and subsidiary were a single entity.
D)​subsidiary information for the subsidiary shareholders.

Quizplus · Accepted Answer

Consolidated financial statements combine the financial results of a parent company and its subsidiaries as if they were a single entity. They provide an overall view of the financial position and performance of the entire group, which is useful for stakeholders such as investors, creditors, and regulators who need to understand the group's financial health as a whole. Consolidated financial statements are not designed to provide subsidiary information for subsidiary shareholders specifically, as they focus on the group as a whole.

Consolidated Financial Statements Are Designed to Provide