Which of the Following Items Would Not Affect the Investor's

question 127

Multiple Choice

Which of the following items would not affect the investor's income for the period?

• A) interest received on a temporary investment in bonds
• B) dividends received on a long-term investment in stock where the investor owns 10% of the investee's stock
• C) dividends received on a long-term investment in stock where the investor owns 30% of the investee's stock
• D) interest received on a long-term investment in bonds

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Definitions:

Proprietorship

A business model where a single individual owns the company and is responsible for its assets and liabilities, also known as a sole proprietorship.

Single Individual

Refers to one person acting in a capacity, either personally or legally, without partnership or company.

Business

An organization involved in the trade of goods, services, or both to consumers.

Capital Deficits

Refers to a situation where a company's liabilities exceed its assets, indicating financial weakness or distress.