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Racer Corp.purchased all of the common stock of Tangiers Co.several years ago.Tangiers maintained its incorporation.Balances in which of Racer's accounts would vary between the equity method and the initial value method?
Discount Rate
The interest rate used to determine the present value of future cash flows in discounted cash flow analysis, reflecting the opportunity cost of capital.
Drive Axle
An axle that is connected to the drive train and responsible for transferring power from the engine to the wheels.
Ring Gear
Spur gear such as that used on a flywheel for engine cranking, or the outer member of a planetary gearset.
Differential Case
The outer housing that encloses the differential mechanism in a vehicle, protecting its gears and components.
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