A Change from Carrying Securities at Fair Value to the Equity

question 28

Multiple Choice

A change from carrying securities at fair value to the equity method of accounting for an investment in common stock resulting from an increase in the number of shares held by the investor requires:

• A)only a footnote disclosure.
• B)that the cumulative amount of the change be shown as a line item on the income statement,net of tax.
• C)retroactive restatement as if the investor always had used the equity method.
• D)that the investor begins accruing income earned by the investee under the equity method at the date of acquisition of the new shares.

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Definitions:

Visual Search

The task of locating a specific visual target among a field of distractors.

Number of Distracters

The quantity of irrelevant stimuli or options that divert attention away from the target information or choice.

Simultaneous Tasks

The performance of multiple tasks at the same time, requiring cognitive flexibility and often leading to divided attention.

Dictation

The act of speaking aloud for someone else to write down or for a machine to record the words.