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Is the full equity method the only option that the parent company has for internal reporting?...

Is the full equity method the only option that the parent company has for internal reporting? Explain why or why not

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Announcing Requirements

Consolidated financial proclamations must be readied utilizing a similar accounting techniques over the parent and auxiliary substances. In the event that applicable, the parent and auxiliaries should all be represented utilizing sound accounting standards (GAAP) if the consolidated financial proclamations are to be as per GAAP. All auxiliary value accounts, for example, regular stock or held income, must be wiped out. A non-controlling interest record might be utilized if the backup isn't entirely possessed. While setting up the consolidated financial explanations, the auxiliary's monetary record accounts are straightened out to the current honest estimation of the financial resources.

Proprietorship Calculation Methods

There are three different ways to compute the possession enthusiasm between organizations. Just organizations that are claimed are incorporated into the consolidated financial explanations. Possession depends on the aggregate sum of stock claimed. On the off chance that an organization claims under 20% of another organization's stock, it might utilize the cost technique for financial revealing. In the event that an organization possesses over 20% yet under half, the organization utilizes the value technique. Under the two strategies, consolidated financial proclamations are not allowed.

ekkarill92 answered 2 years ago
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