When an Investor Owns Between 20% and 50% of the Common

Multiple Choice

When an investor owns between 20% and 50% of the common stock of a corporation it is generally presumed that the investor

A) has insignificant influence on the investee and that the cost method should be used to account for the investment.
B) should apply the cost method in accounting for the investment.
C) will prepare consolidated financial statements.
D) has significant influence on the investee and that the equity method should be used to account for the investment.