Advanced Accounting (Canada) · Intercompany Profits: Depreciable Assets

Why does full consolidation make a group's debt-to-equity ratio look worse than either the parent's or the subsidiary's own statements, and how does upstream vs downstream affect return on equity?

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More in Intercompany Profits: Depreciable Assets

A subsidiary sells a depreciable asset to its parent at a gain (upstream), and the parent owns 80% with a 20% NCI. Who absorbs the unrealized-gain holdback and its later realization?

On consolidation, why can't the group carry an intercompany-transferred depreciable asset at the price the buying affiliate paid for it?

At the date of an intercompany depreciable-asset sale, what exactly gets removed on consolidation, and is it pre-tax or after-tax?

Under the equity method, how does the investor adjust equity-method income for an intercompany depreciable-asset gain across the transfer year and later years?

Why is consolidated depreciation on an intercompany-transferred asset lower than the buyer's recorded depreciation, and what does that lower amount accomplish?

An intercompany profit on inventory or land realizes in one shot, but a depreciable-asset profit does not. What determines the difference?

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