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ACC 499 Midterm Exam (3 Sets)
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This Tutorial contains 3 Sets (All Question Listed Below)
ACC 499 Midterm Part 2 (Set 1)
Question 1
Accountants sometimes refer to the equity method as a(n)
Question 2
When an investor owns less than a majority of the voting stock of
another corporation, the accountant must judge when the
investor can exert significant influence. For the sake of
uniformity, U.S. GAAP and IFRS presume that significant
influence exists at ownership of _____ or more of the voting stock
of the investee. (Assume that management does not have a
contractual or other basis to demonstrate that influence.)
Question 3
U.S. GAAP view investments of between 20 and 50 percent of the
voting stock of another company (unless evidence indicates that
significant influence cannot be exercised) as
Question 4
When an investor uses the equity method to account for
investments in common stock, cash dividends received by the
investor from the investee should be recorded as
Question 5
U.S. GAAP view investments of less than 20 percent of the voting
stock of another company as
Question 6
To avoid double counting P's investment in S, P must eliminate
Question 7
The equity method of accounting for an investment in the
common stock of another company should be used when the
investment