The Equity Method of Accounting for a Stock Investment Should

Multiple Choice

The equity method of accounting for a stock investment should generally be used when the investor owns a level of stock ownership that:

A) gives the investor an insignificant influence over the investee.
B) usually indicates a plan to acquire a controlling interest in the investee company.
C) requires the investor to prepare consolidated financial statements.
D) gives the investor significant influence over the investee company.