Which of the Following Statements Is Incorrect

question 2

Multiple Choice

Which of the following statements is incorrect?

• A)the equity method of accounting adjusts the carrying value of an investment in an associate to reflect post- acquisition changes in the investor's share of the net assets of the investee
• B)accounting for investments at fair value through profit or loss recognises the change in fair value of the investment in income and remeasures the investment to fair value at balance date
• C)the cost method of accounting adjusts the carrying value of an investment in an associate to reflect post- acquisition changes in the investor's share of the net assets of the investee
• D)AASB 128 requires the application of the equity method of accounting to investments in associates in the consolidated financial statements of the investor

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Definitions:

Dividends Paid

The portion of a company's earnings that is distributed to shareholders as a payment.

Strategic Planning

A process by which organizations define their strategy or direction and make decisions on allocating their resources to pursue this strategy.

Operational Planning

The process of planning short-term actions and resources towards achieving medium-term objectives and strategies.

Budgeting

The process of creating a plan to spend your money, outlining projected income and expenses over a period.