Under the Equity Method, the Long-Term Investment Account Is Debited

question 98

Multiple Choice

Under the equity method, the Long-Term Investment account is debited when the:

• A) investee reports net income.
• B) investee reports net loss.
• C) investor receives a cash dividend.
• D) investment is sold.

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Definitions:

Implied-In-Law Condition

A condition in a contract created by the court to ensure fairness, which is not explicitly stated in the contract itself.

Strict Performance

The legal requirement that contractual obligations must be fulfilled exactly as agreed, with no deviations or errors.

Deliver a Deed

The act of officially transferring ownership of real property from the grantor to the grantee by handing over the deed document.

Reasonable Time

A period which is fair and appropriate under the circumstances, considering the specific context of the situation.