No Constructive Gain or Loss Arises from the Purchase of an Affiliate's

question 36

Multiple Choice

No constructive gain or loss arises from the purchase of an affiliate's bonds if the

• A)affiliate is a 100%-owned subsidiary.
• B)bonds are purchased at book value.
• C)bonds are purchased with arm's-length bargaining from outside entities.
• D)gain or loss cannot be reasonably estimated.

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