Question
An investor has an investment in ordinary shares (accounted for under the equity method) and advances to an investee that has been incurring losses. The
An investor has an investment in ordinary shares (accounted for under the equity method) and advances to an investee that has been incurring losses. The investor, in this case, ordinarily should?
A. Continue applying the equity method and provide for the additional losses of the investee after investment in associate and advances have been reduced to zero
B. Discontinue applying the equity method when the investment in associate and advances are reduced to zero
C. Discontinue applying the equity method when the investment in associate is reduced to zero
D. Continue applying the equity method and provide for the additional losses of the investee after investment in associate has been reduced to zero
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