Consolidated financial statements are prepared when one company has:

Question

Quizplus · Accepted Answer

Consolidated financial statements are prepared when one company controls another company, typically through ownership of more than 50% of the voting stock. In essence, the parent company and its subsidiaries are treated as a single economic entity, and the consolidated financial statements show the financial results and position of this entity as a whole. Accounting for the investment as equity or securities available for sale does not necessitate the preparation of consolidated financial statements.

Consolidated Financial Statements Are Prepared When One Company Has