When an Entity Reduces Its Interest in an Investment in Equity

question 16

Multiple Choice

When an entity reduces its interest in an investment in equity securities accounted for by the equity method,and changes to the fair value method,what is the initial cost value for purposes of subsequent changes in market value?

• A) Original cost
• B) Book value at the date of change
• C) Market value at the date of the change
• D) Market value at the date of acquisition

---

Definitions:

Observer

An individual or entity that watches or notices something without directly participating, often used in the context of research or surveillance.

Participant Observation

A methodology associated with ethnography whereby the researcher both observes and becomes a member in a social setting.

Everyday Lives

The daily existence or routine of individuals, encompassing all mundane activities, interactions, and experiences.

Stereotypes

Oversimplified generalizations about groups of people that may not accurately reflect reality, often leading to prejudiced attitudes.