A subsidiary is required to pay it's paren company 55% of the net income. Do I report or credit the Retained Earnings account for the subsidiary by 45%of the Net Income and not the full amount
For example, if the subsidiary earns $100,000 net income. The amount it should record or credit in its retained earnings account is 45,000 (45% of 100,000) and not the full $100,000. Is this correct or does it have to report the full $100,000 even if it's required to share the income.
Does the subsidiary show the distribution of net income and treatt parent like its another partner in the company?How does it show that it shared 55% of its net incme with the parent?
For example, if the subsidiary earns $100,000 net income. The amount it should record or credit in its retained earnings account is 45,000 (45% of 100,000) and not the full $100,000. Is this correct or does it have to report the full $100,000 even if it's required to share the income.
Does the subsidiary show the distribution of net income and treatt parent like its another partner in the company?How does it show that it shared 55% of its net incme with the parent?