Asked by
Kamren Michal Gallas
on Nov 13, 2024
Verified
Gale Company owns 87% of the outstanding stock of Leonardo Company. Leonardo Company is referred to as the
A) parent
B) minority interest
C) affiliate
D) subsidiary
Minority Interest
An ownership stake in a company that is less than 50 percent, indicating that the investor does not have control over business operations.
Outstanding Stock
Shares of a company's stock that have been issued and are currently held by investors, including public shareholders and company insiders.
Parent
In financial terms, this refers to a parent company that owns enough voting stock in another company to control its operations and policies.
- Understand the criteria for classifying a company as a parent or subsidiary and the implications for financial statements.
Verified Answer
NS
Learning Objectives
- Understand the criteria for classifying a company as a parent or subsidiary and the implications for financial statements.