GAAP identifies three levels of influence/control. Which level of influence/control would a company use if it was investing in a company that gave it 15% of the outstanding voting stock?
A) Passive
B) Significant Influence
C) Control
D) Market-level

Question

Quizplus · Accepted Answer

A passive investment would be used when owning up to 20% of the investee company. Significant Influence would be used for investments of between 20% and 50%. Consolidation is required if more than 50% is owned.

GAAP Identifies Three Levels of Influence/control