On 1 January 2016,Yu Ltd Acquired 100 000 Shares (30

question 16

Multiple Choice

On 1 January 2016,Yu Ltd acquired 100 000 shares (30 per cent of the voting interest) in Ping Ltd for $900 000 cash.On 30 June 2016,Ping Ltd announced its earnings per share for the first six months of 2016 at $2.00 per share.On 20 November,Ping Ltd paid dividends to shareholders at $1.20 per share.On 31 December 2016,Ping Ltd announced its earnings per share for 2016 at $3.50 per share (i.e. ,$1.50 additional since 30 June) .
-If Yu Ltd used the equity method,what would have been the impact of Ping Ltd's 31 December 2016 earnings announcement?

• A) Investment in Ping Ltd would have increased by $150 000.
• B) Dividend revenue would have increased by $150 000.
• C) Investment in Ping Ltd would have increased by $150 000 and dividend revenue would have increased by $150 000.
• D) There would be no impact.

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Definitions:

Nativist

A perspective that emphasizes the innate, biological foundations of behavior and cognitive development, often in contrast to the emphasis on environmental influences.

Linguistic Relativity

Linguistic relativity is the hypothesis that the structure of a language affects its speakers' world view or cognition, suggesting that language and thought are interdependent.

Nativist

A theory or perspective that emphasizes the role of innate factors over experience or learning in the acquisition of abilities and characteristics.

Social Communication

The exchange of information and expression of thoughts, feelings, and ideas through verbal and non-verbal means within a social context.