Under the Equity Method of Accounting for an Investment

question 84

Multiple Choice

Under the equity method of accounting for an investment:

• A) The investment account remains at initial value.
• B) Dividends received are recorded as revenue.
• C) Goodwill is amortized over 20 years.
• D) Income reported by the subsidiary increases the investment account.
• E) Dividends received increase the investment account.

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Definitions:

Meiosis

A process of cell division resulting in four daughter cells each with half the number of chromosomes of the parent cell, as in the production of gametes and plant spores.

Chromosomes

Structures within the nucleus of cells that are made up of DNA and proteins and carry genetic information.

Mutation

A sudden variation in a heritable characteristic, as by an accident that affects the composition of genes.

Critical Period

The period from about 18 months to puberty when the brain is especially capable of learning language. Also called the sensitive period.