Chapter 17, Problem 4CA

To determine

Holdings between 20% and 50%: This classification of investments, says that an investor will have more interest or significant interest over the investee company. And investee’s company will report its investment using the equity method.

Equity method: Most common accounting technique used by the organization to get the access on profits gained by their investments in the other organizations is termed as equity method.

To determine the way F Company report the above facts in its December 31, 2018, balance sheet and its income statement for the year then ended. Discuss the rationale for your answer.

Given information: All the related information is provided in the question document.