When Dividends from an Investment Are Recognized as a Reduction

question 40

Multiple Choice

When dividends from an investment are recognized as a reduction of the investment account,the investment must have been of which type?

• A) Minority, Passive Investment
• B) Majority, Passive Investment
• C) Majority, Active Investment
• D) Minority, Active Investment

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Definitions:

Prefiling Period

In securities registration, the period that begins when an issuer starts to think about issuing securities and ends when the issuer files the registration statement and prospectus with the SEC.

Issuer

An entity that issues and is responsible for a financial instrument.

Registration Statement

A set of documents filed with the Securities and Exchange Commission that contains information about a company's financial status, operations, and plans for an initial public offering (IPO).

Securities Trading

Securities trading involves the buying and selling of financial instruments like stocks, bonds, and options in financial markets.