When a parent company applies the initial value method or the partial equity method to an investment, a worksheet adjustment must be made to the parent s beginning Retained Earnings account ( Entry C ) in every period after the year of acquisition What is the necessity for this entry Why is no similar entry found when the parent utilizes the equity method

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Question: When a parent company applies the initial value method or the partial equity method to an investment, a worksheet adjustment must be made to the

When a parent company applies the initial value method or the partial equity method to an investment, a worksheet adjustment must be made to the parent

s beginning Retained Earnings account

(

Entry

*

)

in every period after the year of acquisition. What is the necessity for this entry? Why is no similar entry found when the parent utilizes the equity method?

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