Carr Co.owns 100% of the common shares of Ice Tops Ltd.Carr records its investment in Ice Tops using the cost method.Carr and Ice Tops have transactions with each other.In preparing Carr's consolidated financial statements,which of the following should be done?
A) Ice Tops' retained earnings should be deducted from Carr's retained earnings.
B) Ice Tops' share capital should be added to Carr's share capital.
C) Dividends received by Carr from Ice Tops should be deducted from Carr's dividend income.
D) Carr's receivable from Ice Tops should be netted with Carr's accounts receivable.
Correct Answer:
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