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When consolidating a subsidiary that was acquired on a date other than the first day of the fiscal year, which of the following statements is true in the presentation of consolidated financial statements?

A. Purchased pre-acquisition earnings of the subsidiary are excluded from consolidated earnings

B. Purchased pre-acquisition revenues and expenses are included with combined revenues and expenses

C. Purchased pre-acquisition earnings are deducted from the beginning consolidated stockholders' equity

D. Purchased pre-acquisition earnings are added to the beginning consolidated stockholders' equity

E. Purchased pre-acquisition earnings are reported separately on the consolidated income statement

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M971402

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