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Where any company holds more then 50% shares in any other company then that company holding more then 50% shares is called "PARENT COMPANY" while the company whose shares are hold by the parent company is called "Subsidiary company"
So where there is a parent and subsidiary relationship is exists then it is the requirement of parent company to show the interest in subsidiary company as well as results of it's own operations in one single statement or document which is called "Consolidated Financial Statement" and Consolidated income statement is prepared to show the consolidated income of parent as well as subsidiary company together to show the combine interest of parent in all subsidiaries as well.
Example:
Company A holds 100% shares of company B and company B has operating income of $ 1000 and company A has income of $10000.
So
Consolidated Operating income = $11000
If company A holds 60% interest then
Consolidated operating income = 10000 + 600 = $10600
$ 600 is the 60% share of income of Company B.
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Consolidated income statement?
Consolidated income statement is that statement in which expenses and incomes of subsidiary as well as parents companies shown as a joint in one single income statement.
What is the distinction between operating and non operation income?
Income which is generated by normal business basic operating activities is called net operating income while other income then operating income is called non operating income like interest income or dividend income etc.
What is a consolidated income statement?
Consolidated income statement shows the overall performance of one year by parent company as well as child company in group of companies accounting.
How do you calculate net operating income?
Total operating income less total operating expense = net operating income (or loss if the expenses were higher)
Cost to income ratio?
operating expenses/operating income
What is the difference between operating income and non-operating income?
Operating income is that income which is earned through primary business activity while non operating income is that part of income which is not generated through primary operations of business like interest income, dividend income etc.
What is the target net income?
Target Net income = (Target Operating income)-(Target Operating income x Tax rate) Target operating income = (Revenues-Variable costs)- Fixed Costs
What is targets net income?
Target Net income = (Target Operating income)-(Target Operating income x Tax rate) Target operating income = (Revenues-Variable costs)- Fixed Costs
How do you calculate total operating income?
Gross ProfitLess: Operating expensesOperating income
Formula for Total operating income?
how to calculate total operating income in Manufacturing Sector
What is the difference between ordinary income and operating income?
Ordinary income refers to any income that is not capital gain. Operating income is how much revenue a company will profit.
What is the Formula for incremental net operating income?
The formula for incremental net operating income is net operating assets minus net operating costs. Using this formula can help you learn the net income of a business.
