In this article we will discuss about:- 1. The Reporting of Investments in Corporate Equity Securities 2. Accounting for an Investment—the Equity Method 3. Accounting Procedures Used in Applying the Equity Method 4. Excess of Investment Cost Over Book Value Acquired 5. Elimination of Unrealized Profits in Inventory 6. Fair-Value Reporting Option for Equity Method Investments. Contents: The Reporting of [...]
This statement is meant for displaying the movement in equity during the accounting period. Examples equity components are: i. Equity share capital. ii. Retained earnings: This an account of undistributed profit presented in the Statement of Income in earlier accounting years and profit during the year other than the portions which are set aside under specific reserves including reserves created [...]
Financial Accounting Standards Board (FASB) has listed the following characteristics of equity: 1. Equity in a business enterprise stems from ownership rights. It involves a relation between an enterprise and its owners as owners rather than as employees, suppliers, customers, lenders or in some other non-owner role. Since it ranks after liabilities as a claim to or interest in the [...]