Which term describes the profits that each entity could distribute if distributions between the interrelated entities were made continuously until next to nothing was left?
A) Notional
B) Reciprocal
C) Marginal
D) Consolidated

Question

Quizplus · Accepted Answer

Notional profits are hypothetical profits which assume that intercompany transactions are eliminated and that each entity distributes their profits as soon as possible. It represents the amount of profit that each entity would receive if everything were consolidated and distributed to each entity in proportion to their ownership or interest.

Which Term Describes the Profits That Each Entity Could Distribute