Which of the Following Is Not True When the Fair

question 48

Multiple Choice

Which of the following is not true when the fair value option is elected for an investment that would normally be accounted for under the equity method?

• A)no journal entry need be made to recognize the investor's portion of the investee's net income.
• B)unrealized gains and losses on that investment are recognized in net income.
• C)no journal entry need be made to recognize the investor's portion of dividends paid by the investee.
• D)All of these are true.

Comprehend theories of child and adolescent development related to cognitive growth and learning.

Understand the fundamental principles of double-entry accounting.

Identify transactions that involve compound entries.

Understand how transactions impact account balances.

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Definitions:

Maintenance Cost

Expenditures associated with the upkeep of buildings, equipment, and machines to ensure efficient operation and prolong their life.

Mixed Cost

A cost that contains both variable and fixed cost elements, meaning part of it changes with the level of activity while another part remains constant.

Machine Hour

A unit of measure representing the operation of a machine for one hour, used in accounting to allocate costs to products.

Factory Utility Cost

The expenses associated with the utilities consumed by a factory or manufacturing plant, such as electricity, gas, and water.