TERMINOLOGY FOR INVESTMENTS. A list of terms and a list of definitions

/ or examples are presented below. Make a list of the numbers 1 through 12 and match the letter of the most directly related definition or example with each number.

Transcribed Image Text:

TERM 1. Goodwill 2. Amortized cost method 3. Minarity interest 4. Fair value method 5. New basis accounting Puoling of interests 6. 7. Risk 8. Return 9. Subsidiary 10. Parent 11. Equity method 12. Leveraged buyout DEFINITION OR EXAMPLE a) The amount an investment adds to wealth during a period divided by the investment's value at the beginning of the period b) A corporation controlled by another corporation through stock ownership e) The excess of acquisition cost over the current value of a purchased corporation's identifiable sets d) Used for long-term investments in available-for- sale securities e) A method of accounting that recognizes investment income as it is reported by the investee The uncertainty associated with the expected return on an investment g) Issues cunsolidated financial statements h) Stockholders other than the parent corporation i) Used for debt securities held to maturity 1) A business combination recorded at book value k) A business combination recorded as a purchase A process in which investors, who do not have operations of their own, borrow aggressively to finance acquiring a controlling interest in a corpo- ration