Explore BrainMass
Share

Equity Method of Investment

This content was STOLEN from BrainMass.com - View the original, and get the solution, here!

Several years ago, Einstein, Inc bought 40 percent of the outstanding voting stock of Brooks Company. The equity method is appropriately applied. On August 1 of the current year, Einstein sold a portion of these shares.
a. How does Einstein compute the book value of this investment on August 1 to determine its gain or loss on the sale?

© BrainMass Inc. brainmass.com September 21, 2018, 12:18 am ad1c9bdddf - https://brainmass.com/business/standard-costing-cost-control-and-measuring-performance/equity-method-of-investment-573647

Solution Summary

The solution explains the method of computation of book value as on the date of sale.

$2.19