Under parent company theory,the amount of consolidated net income is equal to the amount of ________ under entity theory.

Question

Quizplus · Accepted Answer

Under parent company theory, consolidated net income is equal to income attributable to controlling stockholders. This is because parent company theory views the subsidiary as an extension of the parent company, and therefore the income of the subsidiary is considered to belong entirely to the controlling stockholders. Noncontrolling interest share or income, as well as income attributable to noncontrolling stockholders, are not relevant under parent company theory.

Under Parent Company Theory,the Amount of Consolidated Net Income Is