How should wilson account for this loss

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Reference no: EM133375249

Question: Wilson Company acquired 40 percent of Andrews Company at a bargain price because of losses expected to result from Andrews's failure in marketing several new products. Wilson paid only $100,000, although Andrews's corresponding book value was much higher. In the first year after acquisition, Andrews lost $300,000.
Required: In applying the equity method, how should Wilson account For this loss?

Reference no: EM133375249

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