Which of the following best describes when to use consolidation accounting instead of the equity method?

• A. Consolidation is used when the investor has significant influence, typically 20% to 50% ownership.
• B. Consolidation is used when the investor has controlling influence, typically more than 50% ownership.
• C. Consolidation is used regardless of the level of influence.
• D. Consolidation is used when the investor has no influence, typically less than 20% ownership.

Answer: (B)