(a) An investment in another entitys equity is classified as an investment in a subsidiary, if the investor can exercise control over the investee. AB acquired 4,000 of the 10,000 equity voting shares and 8,000 of the 10,000 non-voting preference shares of CD. AB acquired 4,000 of the 10,000 equity voting shares of EF and had a signed agreement giving it the power to appoint or remove all of the directors of EF. Required: Explain whether CD and/or EF should