For Non-Consolidated Subsidiaries Where the Parent Owns Less Than a Majority

question 3

Multiple Choice

For non-consolidated subsidiaries where the parent owns less than a majority interest but more than a 20 percent interest,

• A) the equity method is used by a majority of corporations worldwide.
• B) the equity method must be used by U.S. companies.
• C) the cost method recognizes income when earned by the subsidiary.
• D) the equity method recognizes income when a dividend is received by the parent.

Identify the entities responsible for monitoring and enforcing laws related to channel practices.

Recognize sources of power within a distribution channel, such as economic influence and expertise.

Explain the causes of conflict in distribution channels, including vertical and horizontal conflicts.

Understand the concept of a channel captain and the roles it plays within the distribution channel.

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Definitions:

Compounded

The process of calculating interest on both the initial principal and the accumulated interest from previous periods.

Semi-annually

Occurring twice a year or every six months.

Compounded

The process of calculating interest on both the initial principal and the accumulated interest from previous periods, leading to an increase in interest earnings over time.

Quarterly

Pertaining to a period of three months or occurring every three months.