The rationale for the equity method is that it better measures an investor's income from investing activities when, because of its ownership interest, it can exert significant influence over the operations and dividend policy of the investee.

Question

Quizplus · Accepted Answer

The rationale for the equity method is indeed to better measure an investor's income from investing activities when they have significant influence over the investee's operations and dividend policy.

The Rationale for the Equity Method Is That It Better