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    Cost/equity/consolidated method

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    3. What are the criteria for using the cost, equity, or consolidated method of accounting?

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    Definition: Method of accounting : A bookkeeper's chronological list of related debits and credits of a business; forms part of a ledger of accounts.

    There are three ways in which a company can account for the earnings of the companies that it invests in. The first is the same as the method that you or I would use. It's called the "cost method" and it records all income as ...

    Solution Summary

    This solution discusses the criteria for using various methods of accounting.