If 10% of the Ordinary Shares of an Investee Company

question 11

Multiple Choice

If 10% of the ordinary shares of an investee company is purchased as a long-term investment, the appropriate method of accounting for the investment is

• A) the cost method.
• B) the equity method.
• C) the preparation of consolidated financial statements.
• D) determined by agreement with whomever owns the remaining 90% of the shares.

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Definitions:

Agitation

A state of anxiety or nervous excitement, often manifesting in physical movements or verbal outburst.

Delusions

False, persistent beliefs that are unsubstantiated by sensory or objective evidence.

Hallucinations

Perceptions in a conscious and awake state in the absence of external stimuli that have qualities of real perception.

Psychotherapy

The treatment of mental disorder by psychological rather than medical means, involving talking therapies to explore thoughts, feelings, and behaviors for healing or developmental change.