Long-term equity investment: an enterprise holds the investment of other enterprises for a long time. Through equity investment, it can control or have a significant impact on the invested enterprise, so as to spread its own risks and bring economic benefits to the enterprise itself. (that is, the shares of other companies held by the enterprise)

The measurement of long-term equity investment is divided into equity method and cost method, and the accounting treatment methods are as follows:

First, enter an account.

Borrow: long-term equity investment

Loans: bank deposits

2. When receiving dividends:

Debit: bank deposit

Loan: investment income

Three. Under the cost method, long-term equity investment needs to be depreciated and cannot be reversed.

Debit: Asset impairment loss

Loan: impairment reserve for long-term equity investment assets

Four. Dividend distribution

Borrow: long-term equity investment

Loan: investment income

Debit: bank deposit

Loan: interest receivable

Verb (verb's abbreviation) when processing

When disposing of long-term equity investment, the difference between its book value and the actual purchase price is included in the current profit and loss.

Namely: disposal income = price-book value of actually acquired long-term equity investment.

Borrow: bank deposits, etc.

Impairment of long-term equity investment

Loan: long-term equity investment

Investment income (loan or loan)

Under the equity method, when the investment is disposed of, the part originally included in the owner's equity is transferred to the current profit and loss according to the corresponding proportion.

Borrow: capital reserve-other capital reserve

Other comprehensive income

Loan: investment income

Note that the calculation of long-term equity investment should distinguish between equity method and cost method.

Extended file; Complete collection of accounting data