blueberry028
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Joined: 18 May 2016
Location: United States
Online Status: Offline
Posts: 5
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| Posted: 16 Jun 2016 at 20:47 | IP Logged
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the equity method of accounting for investments in
common stock, which of the following affects the
investor's reported investment income?
undervalued asset amortization related to purchase--
yes
cash dividends from investee---no
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I understand the cash div would affect the income, but
becker say the undervalued asset will decrease the
income, I thought should be increase the income,
become if the fair value been undervalued, then the
potion of the amortized should be smaller than normal.
that means they deduct less than normal. should be a
increase ?
thanks for helping me !
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Topic: eqity method
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