Question

Which of the following methods of accounting for investments is appropriate when the investor has significant influence over the investee?

a. cost method.
b. mark to market method.
c. equity method.
d. lower of cost or market method.

Answer 1

The answer is "Option c".

Step-by-step explanation:

The equity method is indeed the conventional technique used whenever an investor, a firm, has a massive effect on some other asset manager.

It is the method used by a company to document its money generated through investment in another company.

The investor should record its profits or losses following its ownership percentage. It regularly changes the value of the property to a balance sheet of even an investor.