When an Investor Reporting Under IFRS Owns More Than 20

question 123

Multiple Choice

When an investor reporting under IFRS owns more than 20% of the common shares of a corporation, it is generally presumed that the investor

• A) has insignificant influence on the investee and that the cost method should be used to account for the investment.
• B) should use the fair value through profit or loss model to account for the investment.
• C) will prepare consolidated financial statements.
• D) has significant influence on the investee and that the equity method should be used to account for the investment.

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Definitions:

Phantom Limb Phenomenon

The phantom limb phenomenon is the sensation that an amputated or missing limb is still attached to the body and is moving appropriately with other body parts.

Human Hearing

The ability of humans to detect and interpret sound waves through a complex process involving the ears and brain.

20 Feet

A measure of length equivalent to approximately 6.096 meters, often used in reference to distance or the dimensions of objects.

Sensory Adaptation

The adjustment of sensory receptors to continuous stimulation, leading to decreased sensitivity to that stimulus over time.