Which of the Following Accounting Methods Is Used to Account

question 103

Multiple Choice

Which of the following accounting methods is used to account for controlling interest investments?

• A)equity method
• B)acquisition method
• C)consolidation method
• D)discounted cash flow method

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Definitions:

Acquired Firm

A company that has been purchased and absorbed by another entity.

Going-Private Transaction

A process in which a publicly traded company is transformed into a privately held entity, often through a buyout from private investors.

Bidding Firm

A company that proposes a financial offer in an attempt to acquire another company or win a contract.

Board of Directors

A group of individuals elected by the shareholders of a corporation to oversee the management and make major decisions affecting the company's policies and strategies.