How to dispose of the accounting entries when the long term equity investment is lost under the equi

When the equity method is adopted, the book balance of the long-term equity investment shall be adjusted according to the change in the share of the owner's equity of the investee.

The difference between the carrying amount of the disposal of a long-term equity investment and the actual purchase price shall be included in the profit or loss for the current period.

That is, the disposal gain = the actual price obtained - the book value of the long-term equity investment.

Borrow: bank deposits, etc.

Provision for impairment of long-term equity investments.

Credit: Long-term equity investment.

loan or borrow) investment income.

Long-term equity investments accounted for by the equity method are included in the owner's equity due to other changes in the owner's equity of the investee other than net profit or loss.

When the investment is disposed of, the part originally included in the owner's equity shall be transferred to the profit or loss for the current period in corresponding proportions.

Borrow: Capital Reserve - Other Capital Reserve.

Other comprehensive income.

Credit: Investment income.

Or make the opposite entry.

When disposing of a long-term equity investment, the difference between the actual price obtained and the carrying amount of the long-term equity investment shall be recognized as investment profit or loss, and if there is a loss, the investment income shall be debited, and the provision for impairment of the long-term equity investment shall be carried forward at the same time.

If there is an amount included in the capital reserve during the holding period, it should be transferred to the investment income account for accounting.

Debit: Bank deposits, etc. (the price actually received).

Provision for impairment of long-term equity investments.

Investment income. Credit: Long-term equity investment - cost.

Profit and loss adjustment (or debit).

Other equity changes (or debits).

Dividends receivable (not yet received).

At the same time: borrow: capital reserve - other capital reserve.

Credit: Investment income.

or do the opposite).

Equity methodUnder the equity method, when a company makes an investment, it is treated as a long-term equity investment.

The initial investment cost is less than the fair value of the investee's identifiable net assets.

shares, the cost of equity investment in the growth period shall be adjusted according to the difference, and at the same time included in the non-operating income. At the end of the period, when the share of the investee's net profit or loss is recognized, the net profit of the investee is adjusted based on the fair value of the investee's identifiable assets at the time of investment.

1. The accounting entries for long-term equity investments accounted for by the equity method are as follows.

Borrow: Bank deposit.

Credit: Long-term equity investment.

Investment income 2. The book balance of the disposed long-term equity investment is included in the asset disposal expenses, and the net income after deducting the cash dividends or profits that have not yet been received and the relevant taxes paid are recognized as the financial payable, and the specific entries in financial accounting are as follows:

Borrow: Asset disposal costs.

Credit: Long-term equity investment (book balance).

Borrow: Bank deposit (actual acquisition price).

Credit: Dividends receivable (cash dividends or profits that have not yet been claimed).

Bank deposits, etc. (related taxes and fees paid).

Treasury contributions payable (credit differences).

Long-term equity investment usually refers to the acquisition of shares in the investee through investment. Under the equity method, when an enterprise disposes of a long-term equity investment, what should be done about the relevant accounting entries?

At the time of disposal: debit: bank deposit.

Provision for impairment of long-term equity investments.

Credit: Long-term Equity Investment – Investment Costs.

Long-term equity investment – profit and loss adjustment (borrowable or loanable).

Long-term equity investment – other silly equity changes (borrowing or lending).

Long-term equity investment – other comprehensive income (borrowable or loanable).

Investment income (borrowable or loanable).

At the same time: borrowing: capital reserve - other capital reserve (carried forward proportionally or in full).

Credit: Investment income.

Or vice versa. Borrow: Other comprehensive income (carried forward by or in full).

Credit: investment income, etc.

Or vice versa. What is a long-term equity investment?

Long-term equity investment refers to the acquisition of shares of the investee through investment. An enterprise's equity investment in other units is generally regarded as long-term holding, as well as through equity investment to achieve control over the investee, or to exert significant influence on the investee, or to establish a close relationship with the investee to diversify operational risks.

What is the return on investment?

Investment income refers to the income obtained by an enterprise or individual from foreign investment (the loss incurred is negative), such as dividend income obtained by an enterprise from foreign investment, bond interest income and profits from joint ventures with other units.

What are the other comprehensive income?

Other comprehensive income belongs to the owner's equity account, which refers to the gains and losses that are not recognized in the current profit or loss according to other accounting standards.