Which One of the Following Statements Is False

question 53

Multiple Choice

Which one of the following statements is false?

• A)Under the equity method, revenue is recognized when net income is earned by the associate.
• B)When the equity method is used to account for an investment in shares, dividends received are accounted for as a reduction in the investment account.
• C)Under the equity method, the investment account is adjusted annually for a portion of associate's net income and for dividends received.
• D)Under the equity method, revenue is recognized when net income is earned by the investor which may not be when it is earned by the investee.

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Definitions:

Personnel Department

is the department within an organization responsible for hiring, training, and managing employees, as well as dealing with personnel-related issues.

Number Of Employees

The total number of individuals working for a company, including full-time, part-time, and temporary staff.

Direct Method

A method of allocating service departments' costs directly to production departments without intermediate allocations.

Machine Hours

Machine hours represent the total time a machine is operated within a specific period. This metric is often used in manufacturing to allocate costs based on machine usage.