MicheleAEtzold,CPA-CHAPTER.pptVIP

Copyright 2008 by Thomson South-Western, a part of The Thomson Corporation. All rights reserved. Consolidated Statements:Subsequent to Acquisition Fundamentals of Advanced Accounting 1th EditionFischer, Taylor, and Cheng Consolidated Statements Subsequent to Acquisition Two basic methods to maintain the parent’s investment account: Equity Method (Simple Sophisticated) Cost Method Equity Method of Accounting for Investments Equity Method: Parent records income when subsidiary reports income Parent used percent of ownership time sub’s net income to record investment income Dividends treat