Which of the following is the first step in determining if one company controls another such that a parent/subsidiary relationship exists?
A)Determine the relevant activities of the investee.
B)Determine how decisions are made regarding the relevant activities.
C)Determine whether the investor has the current ability to direct those relevant activities.
D)Determine the purpose and design of the investee.

Question

Quizplus · Accepted Answer

Determining the purpose and design of the investee is the first step in assessing whether one company controls another. This step helps in understanding the nature of the investee and its operations, which is crucial before assessing control and relevant activities.

Which of the Following Is the First Step in Determining