Apply the Equity Method to find the result for the following events 
a. On December 31, 2000, Company P invests $300 in Company S and receives 30% of the shares of Company S in return. We assume that Company S’s equity (book value) at the time of the purchase was $1,000 (i.e. P paid book value: 30% of $1,000).
b. During the year ended December 31, 2001, Company S earns $100 and pays cash dividends of $20
c. Company S earns $150 and pays dividends of $60 in 2002

Answer rating: 100% (QA)

The Equity Method is used to account for an investment in another company where the investor has sig... View the full answer