Use of the consolidated ﬁnancial statement method of accounting for a long-term investment in common stock of another company is required when the ownership of its voting stock is
A) 20% or more.
B) less than 20%.
C) between 20% and 50%.
D) more than 50%.

Question

Quizplus · Accepted Answer

The consolidated financial statement method of accounting for a long-term investment in common stock of another company is required when the ownership of its voting stock is more than 50%. This level of ownership typically indicates control over the investee, necessitating consolidation of the financial statements.

Use of the Consolidated ﬁNancial Statement Method of Accounting for a Long-Term