In consolidating a wholly owned parent-founded subsidiary, which of the following adjustments or eliminations is not required?
A)Eliminating any unrealized profits or losses
B)Eliminating intercompany payables and receivables
C)Adjusting for intercompany transactions
D)Adjusting for goodwill impairment

Question

Quizplus · Accepted Answer

Adjusting for goodwill impairment is not required in consolidating a wholly owned parent-founded subsidiary because the subsidiary's goodwill is already fully owned by the parent company and is not subject to impairment from external ownership. The other options (A, B, and C) are required adjustments in consolidating a wholly owned subsidiary to eliminate any unrealized profits or losses, intercompany payables and receivables, and adjust for intercompany transactions.

In Consolidating a Wholly Owned Parent-Founded Subsidiary, Which of the Following