The gain or loss resulting from the parent company's disposal of a portion of its investment in a subsidiary is included in income before extraordinary items in the consolidated income statement for the accounting period of the disposal.

Question

Quizplus · Accepted Answer

The gain or loss from the disposal of a portion of an investment in a subsidiary by the parent company is recognized in the consolidated income statement as part of income from continuing operations, before considering any extraordinary items. This treatment aligns with accounting principles that require the effects of transactions among entities within the consolidated group to be reflected in the income statement for the period in which they occur.

The Gain or Loss Resulting from the Parent Company's Disposal