Which of the Following Statements About the Equity Method Is

question 5

Multiple Choice

Which of the following statements about the equity method is NOT true?

• A) The investment asset is valued at cost on acquisition.
• B) The investment asset is increased for the investing company's share of the investee company's profit.
• C) When the investee company pays a dividend, the investing company credits dividend revenue.
• D) The investment asset is decreased for the investing company's share of the investee company's loss.

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Definitions:

Encoding

The process of converting the sender’s ideas into a message, which could be verbal, visual, or both.

Pictures

Visual representations captured by cameras, drawn, or painted, used for art, entertainment, documentation, or communication purposes.

Advertising

The activity or profession of producing advertisements for commercial products or services to stimulate consumer interest.

Noise

Any interference that stems from competing messages, a lack of clarity in the message, or a flaw in the medium; a problem for all communication channels.