The use of proportionate or pro rata consolidation generally has not been acceptable in the United States. Normally, a significant investment in the common stock of another company must either be fully consolidated or reported using the equity method.

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a. What method does Amerada Hess use to account for its investments in affiliates and joint ventures?

b. What method does Alberta Energy Corporation use to account for its investments in jointly controlled ventures? In what country is Alberta Energy based? Does this make a difference?

c. What method does Benton Oil and Gas Company use to account for its investments in other companies that Benton can significantly influence, including Geoilbent, Ltd.? How did Benton account for its investment in Geoilbent prior to 1999? Why did it change?

d. What method does Centex Corporation use to account for its investments in affiliates? Is its treatment of Centex Construction Products Inc. in accordance with generally accepted accounting principles? How might this treatment be justified?

e. Should the method used to account for investments in affiliates be different depending on whether the affiliate is a corporation or an unincorporated partnership? Explain.