Investment in Associates Balanace (Equity Method)

My understanding is that in the equity method, your investment in associates account goes like this:

Beginning Investments

  • Share of of Net Income
  • Share of dividends received

  • Amortization of excess purchase price paid (related to Goodwill)

= Ending Investments account

If you follow this format, doesn’t the amortization of goodwill get counted twice? Doesn’t it also flow through your net income?

Good will is not amortized, its tested for impairment. The amortization that you subtract could be the excess price paid for PPE for example

Yeah - I agree and understand that GW isn’t amortized.

My question still stands though: if you subtract out the excess price paid (for something like PP&E) from the investments account, aren’t you double counting it? My impression is that you also need to subtract the amortized excess price paid for PP&E when you go from revenue -> net income.