Which of the following is a correct statement pertaining to consolidation of a subsidiary with preferred shares? O a. When preferred shares are cumulative, the preferred shareholders are only entitled to income equal to the yearly dividend, if the company has not suffered a loss for the year. O b. If the preferred shares are cumulative, the current year's net income would be allocated to the preferred shares only if dividends are declared in the year. O c. If the preferred shares are non-cumulative, the current year's net income would only be allocated to preferred shares if preferred dividends are declared. O d. If the preferred shares are non-cumulative, the current year's net income would be allocated to the preferred shares whether or not preferred dividends are declareD.

When a subsidiary has preferred stock that is convertible into subsidiary common stock, the parent's equity in the subsidiary's diluted earnings is calculated by the number of   Select one: a. subsidiary common shares held by the parent times the subsidiary's diluted EPS figure.   b. parent shares into which the subsidiary's dilutive securities can be converted times the parent's basic EPS figure.   c. parent shares into which the subsidiary's dilutive securities can be converted times the subsidiary's basic EPS figure.   d.subsidiary shares into which the subsidiary's dilutive securities can be converted times the subsidiary's basic EPS figure.

Do not use negative signs with your answers below. Reconciliation of Cost to Equity Method Parent's pre-consolidation net income 401000 v Dividend Income 81000 v P% x Net income of subsidiary P% x AAP amortization 0 x Net income attributable to controlling interest $ 0 x b. Prepare the consolidated income statement for the current year. Do not use negative signs with your answers below. Consolidated Income Statement Sales $ 12200000 v Cost of goods sold 8120000 v Gross profit 4080000 v Operating expenses 0 x Net income Net income attributable to noncontrolling interests 0 x Net income 0 x