I don t think the subsidiary participation is unfeignedly a problem to prestige Telephone troupe. The grade forward association must think about issues in the long destination and base on the managerial chronicle system. 1. The president besides focuses on the information of pecuniary be provided by its subsidiary. As we all know, financial accouting is usually shown to outer decision-makers, who may be interested in the structure of the fellowship s cyber pose profit, ie. main revenues and related expenses of a accepted year. But prestigiousness Telephone community , to some extent, is a part of the midland decision-makers of the Pretige Data Company. The president should pay more than attentions to information that is accommodative to solve the main problem. In the Exhibt 2, expenses excessively contain dummy cost, which are all paid to prestigiousness Telephone Company . We don t think it portion to do so, pull in from Mr. Rowe we know that Pretige Da ta Company is a separate exactly wholly owned entity by prestigiousness Telephone Company. The space be earth-closet be regarded as a discretionary fixed be to Prestige Telephone Company. This kind of costs can be comfortably reduced by the set up company. When making decisions, such costs as space costs and new(prenominal) payments for coperate services provided by parent company should not be taken into account.
If so, the expenses would be reduced quite a lot. 2. The reveunes stated in the financial accounting statement is establish on the different prices to the parent company($400 per hour) and com mercial sales($800 per hour). However, to d! iscerningly assess the subsidiary s set up value, we d stop use the fair market value. We can suppose if Prestige Telephone Company really cast away the subsidiary, it has to pay doubly the present prices, ie. $800 per hour, for the same service to other independent companies. What s more, just as the case says, the root behind the subsidiary is too good to give up easily. It s rational to predict that the parent company would play from greater losses. As we...If you want to get a lavish essay, order it on our website: OrderCustomPaper.com
If you want to get a full essay, visit our page: write my paper