Equity Method of valuation of investment: In this method, parent company value investment on the historical cost of the investment plus apportioned profit in the associate company less dividend paid by the associate company. Difference in the historical value and the amount paid for investment is debited to goodwill . To choose: The correct option.

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Chapter 4, Problem 4.10.3E

To determine

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Equity Method of valuation of investment: In this method, parent company value investment on the historical cost of the investment plus apportioned profit in the associate company less dividend paid by the associate company. Difference in the historical value and the amount paid for investment is debited to goodwill.

To choose: The correct option.

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