Each Transaction Listed in 1 Through 4 Below Relates to a Long-Term

question 49

Essay

Each transaction listed in 1 through 4 below relates to a long-term investment is equity securities. Select the letters of the accounting effects (a through h) and place them in the space provided. Transactions may have more than one answer.
_____ 1. Using the equity method the market price of the investment increases above its cost.
_____ 2. Using the cost method the market price of the investment increases above its cost.
_____ 3. Using the equity method, the investee company recognizes a net loss for the year.
_____ 4. An investment in a 40%-owned subsidiary is sold for more than its carrying value.

---

Definitions:

Living Longer

The phenomenon of increased average lifespan in a population due to improvements in healthcare, nutrition, and lifestyle.

Colour

The characteristic of visual perception described through hue, saturation, and brightness.

Different Cultures

Different Cultures signify the variety of traditions, languages, customs, beliefs, and values that distinguish social groups and societies from one another.

Bias-free Language

Language that avoids bias, stereotypes, or expressions that discriminate against groups of people based on race, gender, socioeconomic status, and other characteristics.