A subsidiary issues bonds.The parent can then acquire the bonds either directly from the subsidiary or from a nonaffiliate that had originally acquired the subsidiary's bonds.
Required:
a)Discuss the parent's accounting as it relates to the preparation of consolidated financial statements,for their acquisition of the bonds:
from the nonaffiliate.
directly from the subsidiary.
b)Why does it matter who the bonds are acquired from?

Question

Quizplus · Accepted Answer

The Answer of A subsidiary issues bonds.The parent can then acquire the bonds either directly from the subsidiary or from a nonaffiliate that had originally acquired the subsidiary's bonds.
Required:
a)Discuss the parent's accounting as it relates to the preparation of consolidated financial statements,for their acquisition of the bonds:
from the nonaffiliate.
directly from the subsidiary.
b)Why does it matter who the bonds are acquired from?

A Subsidiary Issues Bonds