Sometimes Companies Change the Extent to Which They Can Significantly

question 181

Essay

Sometimes companies change the extent to which they can significantly influence an investee, such that they have to change to the equity method or from the equity method of accounting for the investment.
Required:
Describe the adjustments necessary when a company (1) changes to the equity method from another method, and (2) when a company changes from the equity method to another method.

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Definitions:

Appealed

To apply to a higher court for a reversal of the decision of a lower court.

International Arbitration

A process used to resolve disputes between parties from different countries outside the courts, using agreed upon arbitrators.

Arbitrators

Neutral third parties selected to impartially resolve disputes between parties in a binding arbitration process, outside of the court system.

Legal Representation

involves the act of a lawyer or attorney actively working on behalf of an individual or entity in legal matters or court proceedings.