Under the equity method, how are unrealized gains (losses) reported?

Question

Quizplus · Accepted Answer

Under the equity method, unrealized gains (losses) are not recognized. This method accounts for investments in which the investor has significant influence over the investee but does not control it outright. Unrealized gains or losses (those on transactions not yet completed) are not recognized because they do not reflect completed transactions affecting the investor's share of the investee's net income.

Under the Equity Method, How Are Unrealized Gains (Losses) Reported