Question: Why is the equity method used when significant influence exists?

Why is the equity method used when significant influence exists?

Step by Step Solution

★★★★★

3.42 Rating (184 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

When an investor exercises significant influence over its associate it is in a positi... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

1274-B-C-A-E-T(856).docx

120 KBs Word File

Students Have Also Explored These Related Cost Accounting Questions!

Q:

Hat Limited has a total of 200,000 common shares issued. On October 3, 2014, CT Inc. purchased a block of these shares in the open market at $50 per share to hold as a long-term equity investment....

Q:

Sub Corporation has a total of 500,000 common shares issued. On January 2, 2015, Partridge Inc. purchased a block of these shares in the open market at $10 per share to hold as a long-term equity...

Q:

Hat Limited has a total of 200,000 common shares issued. On October 3, 2017, CT Inc. purchased a block of these shares in the open market at $50 per share to hold as a long-term equity investment....

Q:

(LO 3) Why is the equity method used when significant influence exists?

Q:

1. Why are insignificant equity securities recorded at fair market value but property plant and equipment recorded at cost and inventory recorded at lower of cost or net realizable value? 2. What is...

Q:

Hi , I need a rewrite of an accounting case answer about 3 pages. The case answer and the case are in the attach files! Thank you 2. Impaired assets Topsail intends to replace a major piece of...

Q:

Hi , I need a rewrite of an accounting case answer about 3 pages. The case answer and the case are in the attach files! Thank you 2. Impaired assets Topsail intends to replace a major piece of...

Q:

Hi , I need a rewrite of an accounting case answer about 3 pages. The case answer and the case are in the attach files! Thank you 2. Impaired assets Topsail intends to replace a major piece of...

Q:

Chapter 4 - MATCHING Match the terms in the list to the definitions below. Each term may be used only once. A. Cost method F. Investment elimination K. Computation and B. Partial equity method G....

Q:

At a total cost of $5,600,000, Herrera Corporation acquired 280,000 shares of Tran Corp. common stock as a long-term investment. Tran Corp. has 800,000 shares of common stock outstanding, including...

Q:

A Study of Negative Suggestion (Douglas, Grebert, Webb, 2014). This group were interested in the effects of negative suggestion on members of the public. They placed a sign with the words do not look...

Q:

The schema below represents data for the 2018 FIFA World Cup, where people can buy tickets for matches they would like to attend. It attempts to represent the domain well, but in order to keep the...

Q:

Aldo has just been audited by the IRS. He does not agree with the agents findings but believes that he has only two choices: pay the proposed deficiency or resort to the courts. Do you agree with...

Q:

Some become entrepreneurs solely due to inducement. Identify the major types of inducements and discuss this statement giving examples.

Q:

Selected financial information (in millions, except per share information) is available for CIBC at October 31: Instructions Calculate the dividend yield, payout, earnings per share, and return on...

Q:

Santiago Corp., a publicly traded company, had 2,500 preferred shares issued with a balance of $55,000 and 140,000 common shares issued with a balance of $700,000 at the beginning of the year. The...

Q:

Enviro Corporation reported having 35,000 common shares issued for a total share capital of $140,000 on its December 31, 2011, statement of financial position. On February 15, 2012, it reacquired...

Q:

7. If your client decides to invest 65% of their money into ORP and 35% into Rf security, what would be the expected return of that combination (Rf = 0.1%)? a. 2.70% b. 2.56% c. 1.79% d. 1.76% e....

Q:

Business QUESTION 31 Lucky accountants, the International Accounting Standards are identical to the us. Generally Accepted Accounting Principles (GAAP) for U.S. True False 4 points QUESTION 32 Which...

Q:

1. make sure the answer is in 2 decimals. Read question carefully 2. Make sure the final answer is in 2 decimals. Please read the question carefully 3. Find the future value of a five-year $97,000...