Asked by Joann Quigee on May 10, 2024
Verified
An investing company that owns ________ of another (investee)company's voting stock (but not more than 50%)is presumed to have a significant influence over the investee.
Significant Influence
The power to participate in the financial and operating policy decisions of another company, but not control them.
Voting Stock
Shares that give the holder the right to vote on corporate matters, such as electing the board of directors and approving corporate policies.
- Elucidate on how to account for holdings that exert substantial influence over the governance and operational strategies of the investee.
Verified Answer
JW
Learning Objectives
- Elucidate on how to account for holdings that exert substantial influence over the governance and operational strategies of the investee.