argument of FASB ASC 323 requires that the equity method be used for an investment that gives the investor the ability to exercise significant influence over operating and financial policies of an investee even though the investor holds 50 percent or less of the of the common stock. Specifically, FASB ASC 323-10-15-8 states that direct or indirect investment of 20 percent or more of the voting stock of an investee should lead to a presumption that, in the absence of predominant evidence to the contrary, an investor can exercise significant influence over an investee. Conversely, an investment of less than 20% of the voting stock of an investee should lead to a presumption that an investor cannot exercise significant influence unless such ability can be demonstrated. Highland Laboratories has acquired one-third ownership, enough to exercise significant influence over Abraham Inc. so the equity method seems to be appropriate