Question

ParCorp acquired 100 percent ownership of ChiCorp Company on January 1, 2018, for $128K. Which of...

ParCorp acquired 100 percent ownership of ChiCorp Company on January 1, 2018, for $128K. Which of the followings must have non-zero balance on the consolidated column of the Jan 1, 2018 worksheet?

Minority interest in net assets

Investment in sub

Common stock

None of the above
Business   Accounting   
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Answer #1
Minority interest in net assets of the subsidiary company will be zero as ParCorp has acquired 100% of the company.
Investment in sub will be zero as the balance of the same will get adjusted with share capital and retained earnings of the
subsidiary company.
Common stock will have non- zero balance as the common stock of the holding company shall be reported in the consolidated
balance sheet.
Therefore, answer:   Common Stock
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