For partially owned subsidiaries, part of the rationale of full consolidation is that the parent has a separable percentage interest in each individual asset, liability, and income statement account of the subsidiary.

Question

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The rationale for full consolidation is that the parent company exercises control over the subsidiary, allowing it to direct its activities, rather than having a separable percentage interest in each account of the subsidiary.

For Partially Owned Subsidiaries, Part of the Rationale of Full