When a Subsidiary Owns Shares of the Parent, the Subsidiary's

question 14

Multiple Choice

When a subsidiary owns shares of the parent, the subsidiary's investment account

• A)​should be accounted for using the equity method.
• B)​is not eliminated so the subsidiary's investment in the parent is displayed on the balance sheet.
• C)​is maintained at its original cost since the shares have no claim on income.
• D)​may be accounted for using the cost, equity or sophisticated equity method.

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Definitions:

Retina

A thin layer of tissue at the back of the eye that contains the cells responsible for converting light into neural signals for vision.

Saturation

In color theory, the intensity of a color expressed as the degree to which it differs from white.

Amplitude

The height or strength of a wave signal, which in various contexts can describe the intensity of things like sound, light, or electrical signals.

Wavelength

The distance between successive crests of a wave, especially in sound or electromagnetic waves, it usually determines the wave's characteristic properties like its color (in light) or pitch (in sound).