LargeCo files on a consolidated basis with LittleCo.The subsidiary was acquired for $250,000 on January 1,year 1,and it paid a $40,000 dividend to LargeCo at the end of both year 2 and year 3.

b.LargeCo sold LittleCo to an unrelated competitor for $400,000 on December 31, Year 3. How will LargeCo account for this sale?

Question

LargeCo files on a consolidated basis with LittleCo.The subsidiary was acquired for $250,000 on January 1,year 1,and it paid a $40,000 dividend to LargeCo at the end of both year 2 and year 3.
  
b.LargeCo sold LittleCo to an unrelated competitor for $400,000 on December 31, Year 3. How will LargeCo account for this sale?

Quizplus · Accepted Answer

The Answer of LargeCo files on a consolidated basis with LittleCo.The subsidiary was acquired for $250,000 on January 1,year 1,and it paid a $40,000 dividend to LargeCo at the end of both year 2 and year 3.
  
b.LargeCo sold LittleCo to an unrelated competitor for $400,000 on December 31, Year 3. How will LargeCo account for this sale?

LargeCo Files on a Consolidated Basis with LittleCo