question archive Which of the following are examples of intercompany balances and transactions that must be eliminated in preparing consolidated financial statements? Security holdings Interest and dividends Sales and purchases I, II I, III I, II, III II
Which of the following are examples of intercompany balances and transactions that must be eliminated in preparing consolidated financial statements? Security holdings Interest and dividends Sales and purchases I, II I, III I, II, III II
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Which of the following are examples of intercompany balances and transactions that must be eliminated in preparing consolidated financial statements?
-
- Security holdings
- Interest and dividends
- Sales and purchases
- I, II
- I, III
- I, II, III
- II
Which of the following are examples of intercompany balances and transactions that must be eliminated in preparing consolidated financial statements?
-
- Security holdings
- Interest and dividends
- Sales and purchases
- I, II
- I, III
- I, II, III
- II
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Answer:
C .
Explanation
Inter company balances are the transactions that one company has with another company, within the same group. Inter company transactions are the transactions hat are recorded between companies, under the same company, like sales and purchase of the fixed assets, loans, payments of dividends. All of them are examples of inter-company balances and transactions that must be eliminated in preparing consolidated financial statements.
