Equity accounting is a method of reporting a company's profits from the operations of an affiliated company that it has an interest in but does not own outright.

The cost and equity methods of accounting are used by companies to account for investments they make in other companies. In general, the cost method is used when the investment doesn't result in a ...

Businesses purchase ownership stakes in other companies to achieve objectives they cannot achieve alone. The ownership percentage and that ownership's character determine how the business accounts for ...

A corporation initially books the investment in another company's shares as a noncurrent asset with a value equal to the purchase cost. Whenever the investee issues an earnings report, the investor ...

For most investors, the proper way to account for your investing profits and losses is with the cost method of accounting. This method is not the only choice, however. For investments where the ...

Equity represents the accounting (book) value of a company or it can represent ownership of a specific asset, such as a car or house. Learn more about equity in finance and how investors use it to ...