Homework Answers
A. In Ursula's combined GAAP financial statements the companies which are subsidiary,associates(in some cases but not mandatory) their incomes are to be included in the combined financial statements.
In the above question Ursula owns 100% of Texas, 100% of Paris and 45% of Iowa. So all the companies incomes are included in Ursula's combined GAAP financial statements.
B. Texas and Paris company's incomes are included but not Iowa,as it is not an associate or subsidiary to Ursula.
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