When One Corporation Has a Controlling Interest in Another Corporation

question 3

Multiple Choice

When one corporation has a controlling interest in another corporation whose shares are not actively traded, under ASPE, the investment is accounted for using

• A) either the consolidation method or the equity method or the cost method.
• B) the consolidation method.
• C) either the consolidation method or the equity method.
• D) either the consolidation method or the equity method or the cost method or the FV-OCI method.

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Definitions:

Bailee

A person or entity to whom goods are entrusted for a specific purpose by the bailor, who owns the goods.

Private Property

An ownership model where the possession of land, resources, or items is vested in individuals or organizations, distinct from public or state ownership.

Will

A document executed with specific legal formalities that contains a person’s instructions about the disposition of his property at his death.

Transferred

In the context of property or legal rights, refers to the act of moving ownership, authority, or responsibility from one party to another.