Interpreting Equity Method Investment Footnotes AT&T; reports the following foot

Question

Interpreting Equity Method Investment Footnotes AT&T; reports the following footnote to its 2015 10-K report LO2 AT&T; Inc. Method Investments Investments in partnerships, joint ventures and less than majority diaries in which we have significant influence are accounted for under the equity The following table is a reconciliation of our investments in equity affililates as pre- Equity sented on our consolidated balance sheets. $ millions 2015 2014 Beginning of year 226 1,232 79 175 (30) (148) (3,817) 46 End of year .$1,606 $ 250 ... ed earnings from equity affiliates were $162 and $88 at December 31,2015 and 2014,

Explanation / Answer

a) $1606 . net figure at the bottom

b)Yes . (30) show as dividends

c) 79- 30 = $49 equity income in affiliates - dividends received

d)Income remaining after distributing dividends

e) since a part of the loss or gain in the affiliate is recorded in the income statement , it will affect ROE and RNOA.

f) Because they exert significant influence over the affiliate.

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