Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

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Answer 1

Question

Chapter 1, Problem 22P

a.

To determine

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

b.

To determine

Explain the factors which should have influenced Company E in its decision to apply the equity method in 2018.

c.

To determine

Explain the factors which could have prevented Company E from adopting the equity method after this second purchase.

d.

To determine

Identify the objective of the equity method of accounting.

e.

To determine

Identify the criticisms which have been levelled at the equity method.

f.

To determine

Explain the way in which Company E determines the income to be reported in 2017 in connection with its ownership of Company P and why is this accounting appropriate.

g.

To determine

Explain the way in which the allocation of Company E’s acquisition made.

h.

To determine

Explain if Company F declares a cash dividend, what impact does it have on Echo’s financial records under the equity method and why is this accounting appropriate.

i.

To determine

Explain what amounts are included in Company E’s Investment in Company P’s account and the amounts are included in Company E’s Equity in Income of company P’s account.

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Answer 2

Question

Chapter 1, Problem 22P

a.

To determine

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

b.

To determine

Explain the factors which should have influenced Company E in its decision to apply the equity method in 2018.

c.

To determine

Explain the factors which could have prevented Company E from adopting the equity method after this second purchase.

d.

To determine

Identify the objective of the equity method of accounting.

e.

To determine

Identify the criticisms which have been levelled at the equity method.

f.

To determine

Explain the way in which Company E determines the income to be reported in 2017 in connection with its ownership of Company P and why is this accounting appropriate.

g.

To determine

Explain the way in which the allocation of Company E’s acquisition made.

h.

To determine

Explain if Company F declares a cash dividend, what impact does it have on Echo’s financial records under the equity method and why is this accounting appropriate.

i.

To determine

Explain what amounts are included in Company E’s Investment in Company P’s account and the amounts are included in Company E’s Equity in Income of company P’s account.

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Answer 3

Question

Chapter 1, Problem 22P

a.

To determine

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

b.

To determine

Explain the factors which should have influenced Company E in its decision to apply the equity method in 2018.

c.

To determine

Explain the factors which could have prevented Company E from adopting the equity method after this second purchase.

d.

To determine

Identify the objective of the equity method of accounting.

e.

To determine

Identify the criticisms which have been levelled at the equity method.

f.

To determine

Explain the way in which Company E determines the income to be reported in 2017 in connection with its ownership of Company P and why is this accounting appropriate.

g.

To determine

Explain the way in which the allocation of Company E’s acquisition made.

h.

To determine

Explain if Company F declares a cash dividend, what impact does it have on Echo’s financial records under the equity method and why is this accounting appropriate.

i.

To determine

Explain what amounts are included in Company E’s Investment in Company P’s account and the amounts are included in Company E’s Equity in Income of company P’s account.

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Answer 4

Question

Chapter 1, Problem 22P

a.

To determine

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

b.

To determine

Explain the factors which should have influenced Company E in its decision to apply the equity method in 2018.

c.

To determine

Explain the factors which could have prevented Company E from adopting the equity method after this second purchase.

d.

To determine

Identify the objective of the equity method of accounting.

e.

To determine

Identify the criticisms which have been levelled at the equity method.

f.

To determine

Explain the way in which Company E determines the income to be reported in 2017 in connection with its ownership of Company P and why is this accounting appropriate.

g.

To determine

Explain the way in which the allocation of Company E’s acquisition made.

h.

To determine

Explain if Company F declares a cash dividend, what impact does it have on Echo’s financial records under the equity method and why is this accounting appropriate.

i.

To determine

Explain what amounts are included in Company E’s Investment in Company P’s account and the amounts are included in Company E’s Equity in Income of company P’s account.

Expert Solution & Answer

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Answer 5

Chapter 1, Problem 22P

a.

To determine

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

b.

To determine

Explain the factors which should have influenced Company E in its decision to apply the equity method in 2018.

c.

To determine

Explain the factors which could have prevented Company E from adopting the equity method after this second purchase.

d.

To determine

Identify the objective of the equity method of accounting.

e.

To determine

Identify the criticisms which have been levelled at the equity method.

f.

To determine

Explain the way in which Company E determines the income to be reported in 2017 in connection with its ownership of Company P and why is this accounting appropriate.

g.

To determine

Explain the way in which the allocation of Company E’s acquisition made.

h.

To determine

Explain if Company F declares a cash dividend, what impact does it have on Echo’s financial records under the equity method and why is this accounting appropriate.

i.

To determine

Explain what amounts are included in Company E’s Investment in Company P’s account and the amounts are included in Company E’s Equity in Income of company P’s account.

Answer 6

Chapter 1, Problem 22P

a.

To determine

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

Answer 7

Chapter 1, Problem 22P

a.

To determine

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

Answer 8

b.

To determine

Explain the factors which should have influenced Company E in its decision to apply the equity method in 2018.

Answer 9

b.

To determine

Explain the factors which should have influenced Company E in its decision to apply the equity method in 2018.

Answer 10

c.

To determine

Explain the factors which could have prevented Company E from adopting the equity method after this second purchase.

Answer 11

c.

To determine

Explain the factors which could have prevented Company E from adopting the equity method after this second purchase.

Answer 12

d.

To determine

Identify the objective of the equity method of accounting.

Answer 13

d.

To determine

Identify the objective of the equity method of accounting.

Answer 14

e.

To determine

Identify the criticisms which have been levelled at the equity method.

Answer 15

e.

To determine

Identify the criticisms which have been levelled at the equity method.

Answer 16

f.

To determine

Explain the way in which Company E determines the income to be reported in 2017 in connection with its ownership of Company P and why is this accounting appropriate.

Answer 17

f.

To determine

Explain the way in which Company E determines the income to be reported in 2017 in connection with its ownership of Company P and why is this accounting appropriate.

Answer 18

g.

To determine

Explain the way in which the allocation of Company E’s acquisition made.

Answer 19

g.

To determine

Explain the way in which the allocation of Company E’s acquisition made.

Answer 20

h.

To determine

Explain if Company F declares a cash dividend, what impact does it have on Echo’s financial records under the equity method and why is this accounting appropriate.

Answer 21

h.

To determine

Explain if Company F declares a cash dividend, what impact does it have on Echo’s financial records under the equity method and why is this accounting appropriate.

Answer 22

i.

To determine

Explain what amounts are included in Company E’s Investment in Company P’s account and the amounts are included in Company E’s Equity in Income of company P’s account.

Answer 23

i.

To determine

Explain what amounts are included in Company E’s Investment in Company P’s account and the amounts are included in Company E’s Equity in Income of company P’s account.

Answer 24

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Answer 25

Expert Solution & Answer

Answer 26

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Answer 27

Ch. 1 - Prob. 1Q Ch. 1 - 2. What accounting treatments are appropriate for...Ch. 1 - Prob. 3Q Ch. 1 - 4. Why does the equity method record dividends...Ch. 1 - Prob. 5Q Ch. 1 - Prob. 6Q Ch. 1 - Prob. 7Q Ch. 1 - Prob. 8Q Ch. 1 - Prob. 9Q Ch. 1 - 10. During the current year, Davis Company’s...

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

Explain the way in which Company E initially determine the income to be reported in 2017 in connection with its ownership of Company P.

Explain the factors which should have influenced Company E in its decision to apply the equity method in 2018.

Explain the factors which could have prevented Company E from adopting the equity method after this second purchase.

Identify the objective of the equity method of accounting.

Identify the criticisms which have been levelled at the equity method.

Explain the way in which Company E determines the income to be reported in 2017 in connection with its ownership of Company P and why is this accounting appropriate.

Explain the way in which the allocation of Company E’s acquisition made.

Explain if Company F declares a cash dividend, what impact does it have on Echo’s financial records under the equity method and why is this accounting appropriate.

Explain what amounts are included in Company E’s Investment in Company P’s account and the amounts are included in Company E’s Equity in Income of company P’s account.

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Chapter 1 Solutions