For the following scenarios below, discuss the appropriate accounting treatment. All companies are wholly owned by its immediate holding company.

Discuss the appropriate accounting treatment from the perspective of Company A and Company D in both their consolidated and separate financial statements. In your discussion for Company D, explore if the accounting would have been different had Company D been (1) a new company that was incorporated and (2) an existing business.

Discuss the appropriate accounting treatment from the perspective of Company A and Company B in both their consolidated and separate financial statements.

Discuss the appropriate accounting treatment from the perspective of New Company in both its consolidated and separate financial statements.

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Scenario 1 Company B Company Company A Company C Company D Company B Company A Company C Company D Company E