When a company invests in equity securities with 20% or more, but less than 50%, ownership in the investee's voting stock, the investor can significantly influence the investee's decisions.

Question

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When a company invests in equity securities with 20% or more, but less than 50%, ownership in the investee's voting stock, the investor has significant influence over the investee's decisions. This is because the investor has enough voting power to affect important decisions, but not enough to control them completely.

When a Company Invests in Equity Securities with 20% or More