All of the Following Statements Regarding Accounting for Influential Securities

question 100

Multiple Choice

All of the following statements regarding accounting for influential securities under U.S. GAAP and IFRS are True except:

• A) Under the equity method, the share of investee's net income is reported in the investor's income in the same period the investee earns that income.
• B) Under the consolidation method, investee and investor revenues and expenses are combined.
• C) Under the equity method, the investment account equals the acquisition cost plus the share of investee income plus the share of investee dividends.
• D) Under the consolidation method, nonintercompany assets and liabilities are combined (eliminating the need for an investment account).
• E) U. S. GAAP companies commonly refer to noncontrolling interests in consolidated subsidiaries as minority interests whereas IFRS companies use noncontrolling interests.

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Definitions:

Artificial Selection

The process by which humans breed plants and animals for particular genetic traits, often leading to dramatic changes in morphology, physiology, and behavior over relatively short time periods.

Brassica Oleracea

A species of plant that includes a variety of vegetables, such as cabbage, broccoli, cauliflower, kale, and Brussels sprouts, due to selective breeding.

Plant Organ

A specialized part of a plant, such as roots, stems, leaves, or flowers, that performs a particular function necessary for the plant's life.

Gall Sizes

Variations in the size of plant galls, which are growths induced by organisms like insects as a habitat and food source.