Question: Why does the equity method consider investee dividends as an inappropriate measure of investment income to an investor? Multiple select question. Investee dividends provide for
Why does the equity method consider investee dividends as an inappropriate measure of investment income to an investor?
Multiple select question.
Investee dividends provide for a cash basis of income recognition, not an accrual basis.
Investee dividends objectively measure the investee's income, not the investor's.
Through its significant influence, an investor can influence the timing of investee dividends and thus manipulate income.
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