A Foreign Firm That Is 20% to 49% Owned by a Parent

question 7

Multiple Choice

A foreign firm that is 20% to 49% owned by a parent is called a/an:

• A) subsidiary.
• B) affiliate.
• C) partner.
• D) rival.

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Definitions:

Capital Expenditures

Funds used by a company to acquire or upgrade physical assets such as property, industrial buildings, or equipment.

Balance Sheet Expenditures

Balance sheet expenditures refer to the costs or expenses that are capitalized on the balance sheet rather than being expensed on the income statement, affecting assets and liabilities.

Plant Assets

Long-term tangible assets used in the operation of a business that are not intended for resale, such as machinery and buildings.

Loss on Disposal

The loss incurred when the selling price of an asset is less than its carrying amount at the time of disposal.