Preston Company, a U.S. auto part manufacturer, owns the majority of the voting stock of SEO Bearings Company, located in China. Preston uses the equity method to report its investment in SEO Bearings. Which situation justifies this reporting choice?
A) SEO is controlled by the Chinese government.
B) SEO is located in China.
C) SEO's board of directors includes representation from other entities.
D) SEO's decisions are the responsibility of SEO's CEO.
Correct Answer:
Verified
Q8: Prival Company acquires 49.99% of the voting
Q9: According to U.S. GAAP, when should the
Q10: Following U.S. GAAP, a company consolidates its
Q11: Following U.S. GAAP, if a company owns
Q12: Petron, a U.S. company, owns the majority
Q14: When assessing whether you control another entity,
Q15: A U.S. financial services company sets up
Q16: U.S. GAAP specifies all the following characteristics
Q17: Acme, a U.S. company, has a financial
Q18: Persuasive qualitative evidence that an entity is
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents