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If a Company Owns More Than 20% of the Stock

Question 146

Multiple Choice

If a company owns more than 20% of the stock of another company and the stock is being held as a long-term investment,which method would the investor normally use to account for this investment?


A) Equity method
B) Market value method
C) Historical cost method
D) Straight-line method
E) Effective method

Correct Answer:

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