The cost method is used for reporting investments in securities when equity method and consolidation reporting is inapt whereas equity method is a way by which externals are informed. In equity method, the changing interest or equity of an investor in investee is reflected. To calculate: The amount of net income for the year 2017 using cost method.

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Answer 1

Question

Chapter 2, Problem 2.9E

(a)

To determine

Introduction: The cost method is used for reporting investments in securities when equity method and consolidation reporting is inapt whereas equity method is a way by which externals are informed. In equity method, the changing interest or equity of an investor in investee is reflected.

To calculate: The amount of net income for the year 2017 using cost method.

(b)

To determine

The amount of net income for the year 2017 using equity method.

(c)

To determine

The amount of net income for the year 2017 using fair value method.

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Answer 2

Question

Chapter 2, Problem 2.9E

(a)

To determine

Introduction: The cost method is used for reporting investments in securities when equity method and consolidation reporting is inapt whereas equity method is a way by which externals are informed. In equity method, the changing interest or equity of an investor in investee is reflected.

To calculate: The amount of net income for the year 2017 using cost method.

(b)

To determine

The amount of net income for the year 2017 using equity method.

(c)

To determine

The amount of net income for the year 2017 using fair value method.

Expert Solution & Answer

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Answer 3

Question

Chapter 2, Problem 2.9E

(a)

To determine

Introduction: The cost method is used for reporting investments in securities when equity method and consolidation reporting is inapt whereas equity method is a way by which externals are informed. In equity method, the changing interest or equity of an investor in investee is reflected.

To calculate: The amount of net income for the year 2017 using cost method.

(b)

To determine

The amount of net income for the year 2017 using equity method.

(c)

To determine

The amount of net income for the year 2017 using fair value method.

Expert Solution & Answer

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Answer 4

Question

Chapter 2, Problem 2.9E

(a)

To determine

Introduction: The cost method is used for reporting investments in securities when equity method and consolidation reporting is inapt whereas equity method is a way by which externals are informed. In equity method, the changing interest or equity of an investor in investee is reflected.

To calculate: The amount of net income for the year 2017 using cost method.

(b)

To determine

The amount of net income for the year 2017 using equity method.

(c)

To determine

The amount of net income for the year 2017 using fair value method.

Expert Solution & Answer

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Answer 5

Chapter 2, Problem 2.9E

(a)

To determine

Introduction: The cost method is used for reporting investments in securities when equity method and consolidation reporting is inapt whereas equity method is a way by which externals are informed. In equity method, the changing interest or equity of an investor in investee is reflected.

To calculate: The amount of net income for the year 2017 using cost method.

(b)

To determine

The amount of net income for the year 2017 using equity method.

(c)

To determine

The amount of net income for the year 2017 using fair value method.

Answer 6

Chapter 2, Problem 2.9E

(a)

To determine

Introduction: The cost method is used for reporting investments in securities when equity method and consolidation reporting is inapt whereas equity method is a way by which externals are informed. In equity method, the changing interest or equity of an investor in investee is reflected.

To calculate: The amount of net income for the year 2017 using cost method.

Answer 7

Chapter 2, Problem 2.9E

(a)

To determine

Introduction: The cost method is used for reporting investments in securities when equity method and consolidation reporting is inapt whereas equity method is a way by which externals are informed. In equity method, the changing interest or equity of an investor in investee is reflected.

To calculate: The amount of net income for the year 2017 using cost method.

Answer 8

(b)

To determine

The amount of net income for the year 2017 using equity method.

Answer 9

(b)

To determine

The amount of net income for the year 2017 using equity method.

Answer 10

(c)

To determine

The amount of net income for the year 2017 using fair value method.

Answer 11

(c)

To determine

The amount of net income for the year 2017 using fair value method.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 2 - What types of investments in common stock normally...Ch. 2 - Prob. 2.2AQ Ch. 2 - When is equity method reporting considered...Ch. 2 - Prob. 2.4Q Ch. 2 - Prob. 2.5Q Ch. 2 - Prob. 2.6Q Ch. 2 - Prob. 2.7Q Ch. 2 - Prob. 2.8Q Ch. 2 - How does carrying securities at fair value...Ch. 2 - How does the fully adjusted equity method differ...

Solution Summary: The author explains the cost method used for reporting investments in securities, whereas equity method is a way by which externals are informed.

Concept explainers

The amount of net income for the year 2017 using equity method.

The amount of net income for the year 2017 using fair value method.

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Chapter 2 Solutions