The Wise Company acquired a 20% interest in the outstanding common stock of the Smith Company. The Wise Company can exercise significant influence over the operating and financial policies of the Smith Company. The Wise Company should account for its investment in the Smith Company by using the
A) equity method.
B) cost method.
C) securities held-to-maturity method.
D) lower of cost or market method.
A
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A company contributes to its defined contribution plan. Which one of the following journal entries properly records this transaction?
A.
| DR | Pension asset |
B.
| DR | Projected minimum liability |
C.
| DR | Minimum pension liability |
D.
| DR | Pension expense |
Which of the following statements is true of stock option plans?
a. Compensation expense is recorded only if the option price is less than the stock's fair value on the grant date. b. Compensation is measured on the date the stock is issued. c. The issued stock is recorded at the market price, not the option price. d. They all serve to compensate employees.
A media rep from the local radio station comes into your retail store and suggests running a series of advertisements. She says, "Let's do it and see what happens." What problems can you anticipate with this as the suggested goal?
What will be an ideal response?
Purchase allowances refer to merchandise a buyer acquires but then returns to the seller.
Answer the following statement true (T) or false (F)