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Use of the Cost or Equity Method?

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Minchung77

Lvl 1
15y ago
Updated: 8/17/2019

The Cost method is used when investor does not exercise significant influence.

The equity method is used to account for investments if significant influence can be exercised by the investor over the investee.

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15y ago

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Is it true that stock investments account is debited at acquisition under both the equity method and cost method of accounting for investments in common stock?

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What is the forula for valuation from income basis?

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How do you calculate cost of equity when you only know total equity and PE ratio?

can't