If the Market Value of an Equity Method Investment Falls

question 5

Multiple Choice

If the market value of an equity method investment falls below its book value:

• A)​it is accounted for at the lower of cost or market so an adjustment is made whenever this occurs.
• B)​it is written down, but when the value rebounds, it is readjusted to its original value.
• C)​it is written down if the decline is considered permanent in nature with no subsequent increase in value.
• D)​it is written down if the decline is considered permanent in nature with no subsequent increase in value other than regular equity method adjustments.

---

Definitions:

Ex-Confederate States

The states that seceded from the Union and formed the Confederacy during the American Civil War, working to reintegrate into the United States post-war.

Fourteenth Amendment

An amendment to the United States Constitution granting citizenship to all persons born or naturalized in the U.S. and protecting civil liberties.

Confederate States

Constitutes the group of southern states that seceded from the United States from 1860-1861, leading to the American Civil War.