When the Cost-Adjusted-To-Market Method Is Used to Account for a Long-Term

Multiple Choice

When the cost-adjusted-to-market method is used to account for a long-term investment in the stock of another company,the carrying value of the investment is directly affected by

A) the dividend distributions of the investee.
B) the earnings and dividend distributions of the investee.
C) the earnings of the investee.
D) neither the earnings nor the dividends of the investee.