The following scenarios represent ownership percentages and degree of influence: Ownership Influence I. 10% No significant influ. II. 25% No significant influ. III. 40% Significant IV 55% Control Which of the follwing statements is correct regarding external financial reporting in the above scnarios? a. Use the fair value method under scenarios I and II b. Use the equity method under scenarios II. and III c. Use the equity method under scenarios I, II and III d. Use the acquisition method under scenarios III and IV
The following scenarios represent ownership percentages and degree of influence: Ownership Influence I. 10% No significant influ. II. 25% No significant influ. III. 40% Significant IV 55% Control Which of the follwing statements is correct regarding external financial reporting in the above scnarios? a. Use the fair value method under scenarios I and II b. Use the equity method under scenarios II. and III c. Use the equity method under scenarios I, II and III d. Use the acquisition method under scenarios III and IV
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
The following scenarios represent ownership percentages and degree of influence:
| Ownership | Influence | |
| I. | 10% | No significant influ. |
| II. | 25% | No significant influ. |
| III. | 40% | Significant |
| IV | 55% | Control |
Which of the follwing statements is correct regarding external financial reporting in the above scnarios?
a. Use the fair value method under scenarios I and II
b. Use the equity method under scenarios II. and III
c. Use the equity method under scenarios I, II and III
d. Use the acquisition method under scenarios III and IV
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