Under the Equity Method, a Company Should Report an Unrealized

question 176

Multiple Choice

Under the equity method, a company should report an unrealized gain on a long-term investment:

• A) when the market price is greater than cost.
• B) when the market price is less than cost.
• C) if the investee stock has fallen below the investors cost.
• D) in no instance. No adjusting entry is made.

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Definitions:

Presentation

The act or process of showing, demonstrating, or disclosing something, often involves conveying information to an audience.

Ulcer

A sore that develops on the lining of the esophagus, stomach, or small intestine.

Burning Sensation

An uncomfortable feeling of heat or pain on or under the skin, commonly associated with conditions affecting the nerves or skin.

Excessive Sweating

The production of sweat in amounts greater than needed for body temperature regulation, medically known as "hyperhidrosis."