The reporting treatment for investments in common stock depends on the level of ownership and the ability to influence the investee's policies. The reporting treatment may even change over time as ownership levels or other factors change. When investees are not consolidated, the investments typically are reported in the Investments section of the investor's balance sheet. However, the investor's income from those investments is not always easy to find in the investor's income statement.

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a. Harley-Davidson, Inc., holds an investment in the common stock of Buell Motorcycle Company. How did Harley-Davidson report this investment before 1998? How does it report the investment now? Why did Harley change its method of reporting its investment in Buell?
b. How does Chevron Corporation account for its investments in affiliated companies? How does the company account for issuances of additional stock by affiliates that change the company's proportionate dollar share of the affiliates' equity? How does Chevron treat a differential associated with an equity-method investment? How does Chevron account for the impairment of an equity investment?
c. Does Sears have any investments in companies that it accounts for using the equity method? Where are these investments reported in the balance sheet, and where is the income from these investments reported in the income statement?