Barnum Company owns an investment and uses the equity method of accounting. Under the equity method of accounting, Barnum would decrease the Investment in Affiliates account for the proportionate share of the affiliate's reported net loss.

Question

Quizplus · Accepted Answer

Under the equity method of accounting, the investor's proportionate share of the affiliate's reported net loss is recognized and decreases the Investment in Affiliates account.

Barnum Company Owns an Investment and Uses the Equity Method