In Order to Use the Cost Method of Accounting for Stock

question 138

Multiple Choice

In order to use the cost method of accounting for stock investments, how much stock must the investor own?

• A) Less than 20%.
• B) More than 50%.
• C) Between 20% and 50%.
• D) The cost method is always used for stock investments of any size.

---

Definitions:

Merger

The legal combination of two companies, usually in order to maximize efficiency and profits by eliminating redundant infrastructure and personnel.

Verizon

A multinational telecommunications company offering wireless products and services.

Complementary Activities

Additional tasks or exercises that support and enhance the primary objectives or learning outcomes in a given context.

Consumption

The utilization of goods and services, either for personal use or in manufacturing.