1. How does the consolidation process deal with a subsidiarys preferred stock?

2. Why is it not possible to add the separately computed EPS amounts of individual affiliates in deriving consolidated EPS?

3. How are dividends that are paid to the parents preferred shareholders and to the subsidiarys preferred shareholders treated in computing consolidated EPS?

4. Why do companies that file consolidated tax returns often choose to allocate tax expense to the individual affiliates?

5. How are treasury shares held by a subsidiary reported in the consolidated financial statements?

6. What is indirect ownership?