Shares of subsidiary in relation to existing stock ownership

Reference no: EM13259504

If a parent company and outside investors purchase shares of a subsidiary in relation to existing stock ownership (ratably)

a. there will be no adjustment to additional paid-in capital regards if the stock is sold above or below book value

b. will requirement an investment account adjustment.

c. will require the elimination of a gain depending upon whether it was conducted at economic arm's length

d. will require the elimination of a loss depending upon whether it was conducted at economic arm's length

Reference no: EM13259504

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