Question

Lisa Co. paid cash for all the voting common stock of Victoria Corp. Victoria will continue to exist as a separate corporation. Entries for the consolidation of Lisa and Victoria would be recorded in:

A) a worksheet
B) Lisa's general ledger
C) Victoria's general ledger
D) Victoria's secret consolidation journal
E) the general ledgers of both companies

Answer 1

The entries for the consolidation would be recorded in Victoria's general ledger or the general ledgers of both companies.

Step-by-step explanation:

The entries for the consolidation of Lisa and Victoria would be recorded in Victoria's general ledger or the general ledgers of both companies.

In the case where Victoria Corp will continue to exist as a separate corporation, the consolidation process typically involves combining the financial statements of both companies into one.

This can be done by posting consolidation entries in the general ledger of Victoria Corp, reflecting the acquisition of Lisa Co.'s stock and the subsequent elimination of intercompany transactions.