BUSI 1043 Quit 4 (chapter 8-Investments) 1) The equity method of accounting for a stoc method of accounting for a stock investment should generally be used when the investor owns 20-50% of the investee's stock, because that level of stock ownership Alusually indicates a plan to acquire a controlling interest of the investee company requires the investor to notify the moment of any plans to acquire a controlling interest in the investee company C) means the investor has a controlling interest in the investee company D) gives the investor significant influence over the investee company 2) Under the guity method of accounting for investments, dividends paid by the investee are recorded by the investor as A) a credit Dividend Revenue of the investor company B) a debit to the Investment account of the investor company C) a credit to the Investment account of the investor company D) no entry is made to record dividends in this accounting situation 3) Power Generation Corp. owns 35% of Electric Limited. Net income for Electric Limited for the year ending December 31, 2014, is $150,000. The journal entry prepared by Power Generation Corp. on December 31, 2014, includes: A) debit to Cash for 5171.000 1) credit to Long-Term Investment for $171.000 C) debit to Long-Term Investment for 5450,000 D) debit to long-Term Investment for 517.000 3) A in or loss on sale or a long-term investment using the equity method is determined by comparing the cash received with the A) cost of the longer investment 1) art of the long-term investment C ost of the long-term investment adsted for the investors share of the invest's income and cash dividends while the investment was held by the investor company Beach Limited owns of Alberta Besed Inc. Total cash dividends paid by Albert Based h ar ending December 31, 2016 amount to 19. The journal entry prepared by Brighton Beach Limited on December 31, 2014 includes a A) debatte C or $47,918 L) credit to Dividend Revenue for 519.166 credit to Long Term lavestment for ST9 100 e stment for 51155 D n omaly one where the investor A occount for the instant e method of counting for the investment a parent com and its subsidiary have accounts receivable from mutually exclusive external sources the amounts of 535.000 and $20,000, respectively, the consolidated balance sheet for the parent and its subsidiary will show