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62. Under the partial equity method, how does a parent company record dividend during the year (not the consolidation entries)? a. A reduction in the

62. Under the partial equity method, how does a parent company record dividend during the year (not the consolidation entries)?

a. A reduction in the investment account during the year b. Income to the parent company during the year c. An increase in the investment account during the year

d. Dividends are not recognized at all under the partial equity method

e. Dividends are not allowed for subsidiaries that have been acquired

63. A company chooses to recognize net income of their subsidiary and the dividends as a reduction in the investment account. The company will also recognize amortization on its internal records. Which method is being used for consolidation purposes?

a. Partial Equity Method

b. Equity Method c. Intial Value Method d.Conservative Method

e. Fair Value Method

73. Which of the following is true about the consolidation methods for internal recording keeping (equity method, partial equity method, and initial value method)?

  1. You are only allowed to recognize goodwill under the equity method and partial equity method.
  2. You are only allowed to recognize goodwill under the initial value method.
  3. Depending on the method, the investment balance will be different on the consolidated balance sheet.
  4. Depending on the method, the investment balance on the internal books will be different.
  5. C* is only required for the equity method.

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