A gain or loss on the sale of a long-term investment using the equity method is calculated by taking the difference between the cash received and:

Question

Quizplus · Accepted Answer

The carrying value of the investment is equal to the cost of the investment adjusted for the investor's share of the investee's net income or loss. When a long-term investment using the equity method is sold, the gain or loss is calculated by taking the difference between the cash received and the carrying value of the investment. Therefore, the correct option is D.

A Gain or Loss on the Sale of a Long-Term