Problem 3 - Reading 21

Based on the answer (Choice B), is it correct to say that, under US GAAP, the stockholders’ equity of the parent (i.e, investor) company under the equity method (i.e., “one-line” consolidation) of accounting will be same as that under the purchase method of accounting?

Yes. The Equity method asset = consolidation asset - consolidation liability. Basically you raise both assets and liabilities for consolidation purpose but the S/E would be the same. Simarly result would be true for I/S as well, you will have both revenue and expense increase under consolidation but the NI would be the same.