There Is a Noncontrolling Interest When ________

question 125

Multiple Choice

There is a noncontrolling interest when ________.

• A) a company uses the equity method to account for ownership of another company
• B) a company controls another company, but owns less than 100% of voting shares
• C) a company controls another company but owns less than 100% of that other company
• D) a company is owned by others outside the company

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Definitions:

Compensating Balances

Minimum balance requirements mandated by banks for borrowers, serving as a form of security for the loan.

Effective Cost

Effective Cost is the total cost of a product or service once all relevant factors, including hidden costs and indirect expenses, are considered.

Loan

is a sum of money borrowed that is expected to be paid back with interest.

Receivables

Money owed to a business by its customers for goods or services that have been delivered or sold but not yet paid for.