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When the Cost Method of Accounting for Investments in Another

Question 37

Multiple Choice

When the cost method of accounting for investments in another company's voting shares is used, the balance of the investment in shares account is affected by:


A) the net income or loss of the investee company.
B) the dividends of the investee company.
C) the purchase of additional shares of the investee company.
D) both the earnings and dividends of the investee company.

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