7. Brock Inc decides that it will be selling is subsidiary Breck Inc in a few years Brock has excluded Brecks activities from its 31 consolidate financial results 32 Principle Qualitative Charactertic

Question

7. Brock Inc decides that it will be selling is subsidiary Breck Inc in a few years Brock has excluded Brecks activities from its 31 consolidate financial results 32 Principle Qualitative Charactertic

Answer 1

32. **Principle**. Brock Inc.'s decision to exclude Breck Inc.'s activities from its consolidated financial results because it will be sold in a few years reflects the **control principle**. Consolidated financial statements are meant to reflect the financial position and performance of a parent company and its controlled subsidiaries *as a single economic entity*. If Brock Inc. plans to sell Breck Inc., it will no longer control Breck Inc. in the future, and therefore, it's appropriate to exclude Breck Inc. from consolidation.

Question

7. Brock Inc decides that it will be selling is subsidiary Breck Inc in a few years Brock has excluded Brecks activities from its 31 consolidate financial results 32 Principle Qualitative Charactertic

Solution

Answer