Intragroup borrowings must be eliminated because:

Question

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Intragroup borrowings must be eliminated in consolidated financial statements because the interest paid on these borrowings does not represent a transaction with external parties (A), and these amounts owing do not represent borrowings with parties external to the economic entity (C). This is necessary to present a true picture of the economic entity's financial position and performance to external users.

Intragroup Borrowings Must Be Eliminated Because