When an Investor Owns Between 20% and 50% of the Common

question 6

Short Answer

When an investor owns between 20% and 50% of the common stock of a corporation it is generally presumed that the investor has _______________ influence over the investee and therefore the appropriate method of accounting for this type of investment is the _______________ method.

Understand the concept of first-mover advantage and its impact on business success.

Recognize the importance of a business plan and the key components it should contain.

Identify the different forms of business ownership and the legal implications of each.

Understand the role of operational planning and marketing strategy in a business plan.

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Definitions:

Labor Efficiency Variance

The difference between the actual hours worked by employees to produce goods and the expected hours, used to measure workforce efficiency.

Variable Overhead Rate Variances

The difference between the actual variable overhead incurred and the standard variable overhead allocated to production, indicating cost control efficiency.

Lubricants

Oils, greases, and other substances used to reduce friction between mechanical parts.

Supplies

Items and materials used in the daily operations of a business, often consumable and regularly replaced.