Create, Inc., a domestic corporation, owns 100% of Vinyl, Ltd., a foreign corporation and Digital, Inc., a domestic corporation. Create also owns 12% of Record, Inc., a domestic corporation. Create receives no distributions from any of these corporations. Which of these entities' net income is included in Create's income statement for current-year financial reporting purposes?

a. Create, Vinyl, and Digital.

b. Create, Digital, and Record.

c. Create, Vinyl, Digital, and Record.

d. Create, Vinyl, and Record.

Question

Dear

Business

17 January, 09:47

Create, Inc., a domestic corporation, owns 100% of Vinyl, Ltd., a foreign corporation and Digital, Inc., a domestic corporation. Create also owns 12% of Record, Inc., a domestic corporation. Create receives no distributions from any of these corporations. Which of these entities' net income is included in Create's income statement for current-year financial reporting purposes?

a. Create, Vinyl, and Digital.

b. Create, Digital, and Record.

c. Create, Vinyl, Digital, and Record.

d. Create, Vinyl, and Record.

+3

Answers (1)

Know the Answer?

Jaron · Answer 1

c. Create, Vinyl, Digital, and Record

Explanation:

The answer is

c. Create, Vinyl, Digital, and Record

Since Create Inc. which is a domestic corporation, owns 100% shares in two enterprises. One is Vinyl Ltd. which is a foreign corporation and the other is Digital Inc. which is a domestic corporation. And Create Inc. also happens to own 12% shares in a domestic corporation named Record Inc.

Now since Create Inc. owns shares in all the three corporations, all these corporations's net income will be included in the Create's income statement current-year financial report.

Thus the answer is

c. Create, Vinyl, Digital, and Record