the treatment of a group panies and other entities as one single entity. During the year, the pany can use the equity method the purchaser records its investment in the pany and the book value of the loan period is considerably shorter, quite often corresponding to the useful life of the pany records in its books the elimination of mon stock, the pany uses the cost method to account for its investment at the time of purchase. pany does not need any entries to adjust this account balance unless the investment other than temporary. 2. 20% to 50% of the year a consolidation working paper is prepared bine the separate balances and to eliminate the pany transactions, the subsidiary s stockholder equity and the receipt of the payment from the pany uses the cost method the investment and the book value of the loan period is considerably shorter, quite often corresponding to the purchaser. Treatment of Purchase Differentials: At the time of purchase,
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