1
Q
the initial investment in securities to be accounted for using the equity method will be reported at..
A
cost
2
Q
entry for recording initial investment
A
dr. equity investment
cr. cash
3
Q
diagram with goodwill
A
purchase price
goodwill (unidentifiable asset)
net fair market value
(identifiable assets)
net book value
4
Q
T account for investment
A
investment- On BS
Original cost dividends
Equity method Depreciation
balance
5
Q
T accounting for income
A
income- On IS
depreciation equity method
balance
