Use of the equity method of accounting facilitates a parent company's issuances of unconsolidated financial statements to the Securities and Exchange Commission if the SEC requires such statements.

Question

Quizplus · Accepted Answer

The equity method allows a parent company to report its share of an investee's profits or losses, which can be useful for preparing unconsolidated financial statements if required by the SEC.

Use of the Equity Method of Accounting Facilitates a Parent