When a company applies the initial value method in accounting for its investment in a subsidiary, and the subsidiary reports income in excess of dividends paid, what entry would be made to convert to full$-$accrual totals in a consolidation worksheet for the second year?

A$)$ Retained earnings

Investment in subsidiary

B$)$ Investment in subsidiary

Retained earnings

C$)$ Investment in subsidiary

Equity in subsidiary$$s income

D$)$ Equity in subsidiary$$s income

Investment in subsidiary

E$)$ Additional paid$-$in capital

Retained earnings

Multiple Choice

Entry A

Entry C

Entry D

Entry E

Entry B