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If an investor owns less than 20 of the common stock

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94.If an investor owns less than 20% of the common stock of another corporation as aninvestmenta.the equity method of accounting for the investment should be employed.b.no dividends can be expected.c.it is presumed that the investor has relatively little influence on the investee.d.it is presumed that the investor has significant influence on the investee.Ans: C, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC: ProjectManagement, IMA: Business Economics
95.If the cost method is used to account for an investment in common stock, dividendsreceived should beFSA
96.Under the cost method of accounting for dividendsFSA
97.If 10% of the common stock of an investee company is purchased as an investment, theappropriate method of accounting for the investment is

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Term
Fall
Professor
professor_unknown
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