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When Are Gains on Intercompany Transfers of Assets Between an Investor

Question 1

Multiple Choice

When are gains on intercompany transfers of assets between an investor an associate recognized as part of the investment income accounted for by the investor under the equity method?


A) In the period when the intercompany transfer takes place.
B) In the period(s) when the assets are sold to third parties or consumed.
C) They are never recognized.
D) They are recognized only when the investment is sold.

Correct Answer:

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