Music,Inc. ,a domestic corporation,owns 100% of Vinyl,Ltd. ,a foreign corporation and Digital,Inc. ,a domestic corporation.Music also owns 12% of Record,Inc. ,a domestic corporation.Music receives no distributions from any of these corporations.Which of these entities' net income are included in Music's income statement for current year financial reporting purposes?

Question

Quizplus · Accepted Answer

Only the net income of the subsidiaries that Music,Inc. owns 100% of (Vinyl,Ltd. and Digital,Inc.) are included in Music's income statement. The net income of Record,Inc. is not included, as Music only owns 12% of the company. Since Music does not receive any distributions from any of these corporations, there are no additional factors to consider.

Music,Inc ,A Domestic Corporation,owns 100% of Vinyl,Ltd