Under the Partial Equity Method of Accounting for an Investment

question 48

Multiple Choice

Under the partial equity method of accounting for an investment,

• A) The investment account remains at initial value.
• B) Dividends received are recorded as revenue.
• C) The allocations for excess fair value allocations over book value of net assets at date of acquisition are applied over their useful lives to reduce the investment account.
• D) Amortization of the excess of fair value allocations over book value is ignored in regard to the investment account.
• E) Dividends received increase the investment account.

---

Definitions:

Retaining Information

The process of keeping or maintaining knowledge in the memory for a period of time.

Releasing Information

The process of providing or disseminating information to parties who are authorized to receive it.

Knowledge

The information, understanding, and skills that individuals acquire through experience, education, and training.

Personal Qualifications

The abilities, experience, and educational background that make an individual suitable for a particular job or task.