Cost Method (External Reporting)

Question 1

Cost method indicates ownership of less than _____ and _____ exercise significant influence

Answer 1

20%; does not

Question 2

“Investment in Investee” ______ adjusted for investee earnings

Answer 2

is not

Question 3

“Investment in Investee” _______ adjusted to FV

Answer 3

is

Question 4

Cash dividends from the investee are reported as ______ by the investor (parent)

Answer 4

income