The process of preparing the combined financial statements of a group of entities is known as:
A) aggregation.
B) combination.
C) accumulation.
D) consolidation.

Question

Quizplus · Accepted Answer

The process of preparing the combined financial statements of a group of entities is known as consolidation. Consolidation involves combining the financial statements of the parent company and its subsidiaries into one set of financial statements that represents the entire group. This process involves eliminating intercompany transactions, adjusting for non-controlling interests and equity method investments, and presenting a combined set of financial statements that accurately reflects the financial position and performance of the group as a whole.

The Process of Preparing the Combined Financial Statements of a Group