Explore BrainMass
Share

Equity Method of Investment

This content was STOLEN from BrainMass.com - View the original, and get the already-completed 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 October 25, 2018, 9:25 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
See Also This Related BrainMass Solution

Financial Statement Analysis - Coca Cola

Quest 1 - Page W90

Required:

1. Given the relationship between Coke and Enterprises, discuss the appropriateness of Coke's use of the equity method to account for it investment in Enterprises.

Please see attached for all other questions.

View Full Posting Details