A Gain or Loss on the Sale of a Long-Term

question 23

Multiple Choice

A gain or loss on the sale of a long-term investment using the equity method is determined by comparing the cash received with the:

• A)lower-of-cost-or-market value of the long-term investment.
• B)cost of the long-term investment.
• C)market value of the long-term investment.
• D)cost of the long-term investment, adjusted for the investor's share of the investee's net income and cash dividends, while the investment was held by the investor company.

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Definitions:

Constitution

Essential doctrines or traditional benchmarks that shape the management of a state or equivalent institution.

Separation of Powers

A fundamental principle in constitutional law where the government is divided into distinct branches (legislative, executive, judicial), each with its own powers and responsibilities to prevent abuse of power.

Government

The system or group of people governing an organized community, often a state, including the institutions and officials in charge of policy making and administration.

Judicial Review

The power of the courts to assess the constitutionality of legislative acts or executive actions.