short answer questions 51 how can an investor benefit from an equity investment that 4296678
Short Answer Questions
51.How can an investor benefit from an equity investment that does not pay dividends?
52.Investments in equity securities for which the investor has insignificant influence over the investee are classified for reporting purposes under the fair value method in one of two categories. What are these two categories? How do we report unrealized holding gains and losses under each of these two categories?
53.Under what circumstances do we use the equity method to account for an investment in stock? Explain how we record dividends received from an investment in a company accounted for using the equity method.
54.Discuss the meaning of consolidated financial statements. When is it appropriate to consolidate financial statements of two companies?
55.Investments in debt securities are classified for reporting purposes in one of three categories. List these three categories and explain which investments are included in each category. Also briefly describe how the reporting differs for each category.