Question 1. Are consolidated financial statements likely to be more useful to the owners of the parent company or to the non-controlling owners of the subsidiaries? Why?
Question 2. What is push-down accounting? Under what conditions is push-down accounting considered appropriate? What happens to the differential when push-down accounting is used following a business combination?
Question 3. What is negative goodwill? How is it reported in the consolidated balance sheet?
Question 4. Explain why consolidated financial statements become increasingly important when the purchase differential is very large.