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What is the effect of a company electing the fair value option with respect to an investment that otherwise would be accounted for using the equity method?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 4DQ

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What is the effect of a company electing the fair value option with respect to an investment that otherwise would be accounted for using the equity method?

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What is the fair value option? Where do companies thatelect the fair value option report unrealized holdinggains and losses?
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