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Which of the Following Is/are True Regarding Minority, Passive Investments

Question 8

Multiple Choice

Which of the following is/are true regarding minority, passive investments?


A) An investor acquires the common stock of another entity for the interest, dividends, and capital gains anticipated from share ownership.
B) The acquiring company's ownership percentage is sufficiently small that it cannot control or exert significant influence over the other company.
C) U.S.GAAP and IFRS view investments of less than 20% of the voting shares of another company as minority, passive investments in most cases.
D) An investor who intends to hold the shares for less than a year would classify them as current assets; if the expected holding period is longer, the investor would classify them as noncurrent assets.
E) all of the above

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