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Basic Question 7 of 10
Which of the following statements best describes why minority active investments are not marked-to-market?
B. The investor company is generally not interested in selling the investment, and financial statement users are presumed to be less interested in the investment's fair value.
C. Minority active investments are less than 20%, and the mark-to-market procedure is not required under GAAP.
A. The investor company consolidates minority active investments, and the investment amount is not shown on the balance sheet.
B. The investor company is generally not interested in selling the investment, and financial statement users are presumed to be less interested in the investment's fair value.
C. Minority active investments are less than 20%, and the mark-to-market procedure is not required under GAAP.
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I used your notes and passed ... highly recommended!
Lauren
Learning Outcome Statements
describe the classification, measurement, and disclosure under International Financial Reporting Standards (IFRS) for 1) investments in financial assets, 2) investments in associates, 3) joint ventures, 4) business combinations, and 5) special purpose and variable interest entities;
distinguish between IFRS and US GAAP in their classification, measurement, and disclosure of investments in financial assets, investments in associates, joint ventures, business combinations, and special purpose and variable interest entities;
analyze how different methods used to account for intercorporate investments affect financial statements and ratios.
CFA® 2025 Level II Curriculum, Volume 2, Module 10.