Fisher Corporation Has the Following Investments at September 30, 2012

question 65

Multiple Choice

Fisher Corporation has the following investments at September 30, 2012: What method of accounting can Fisher not use to account for its investment in Cookstown?

• A)Amortized cost.
• B)Equity method.
• C)Fair value through other comprehensive income.
• D)Fair value through profit or loss.

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Definitions:

Appraisal Rights

The rights of shareholders to demand the payment of a fair valuation of their shares in the event of certain corporate actions, like mergers or consolidations, that they find unsatisfactory.

Short-Form Mergers

A streamlined merger process available when a parent company merges with a subsidiary of which it owns a significant majority.

Consolidation

The act of combining multiple entities, assets, or processes into a single, more effective and efficient structure.

Liabilities

Financial obligations or debts that a company or individual owes, which are recorded on the balance sheet and must be settled over time.