Under the equity method, the Investment in Associates account is increased when the
A)associate reports net income.
B)associate pays a dividend.
C)associate reports a loss.
D)investment is sold at a gain.

Question

Quizplus · Accepted Answer

Under the equity method, the Investment in Associates account is increased when the associate reports net income, as the investor recognizes its share of the associate's earnings, which increases the carrying amount of the investment.

Under the Equity Method, the Investment in Associates Account Is