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Investment in section 8 company

Atharv Sankliya (1323 Points)

10 February 2023

does investment in shares of section 8 company is recorded as investment in balance of the company (investor)

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Aarika (Finance Professional) (1855 Points)
Replied 13 February 2023

Investment in shares of a Section 8 company is recorded as an investment in the balance sheet of the company that made the investment (the investor). The balance sheet is a financial statement that provides a snapshot of a company's financial position at a specific point in time. It shows the company's assets, liabilities, and equity, including investments in shares of other companies.

When the investor buys shares of a Section 8 company, the investment is recorded as a long-term investment in the balance sheet. The investment is initially recorded at its cost, and then the carrying value may be adjusted over time to reflect any changes in the market value of the shares. The value of the investment is reported in the balance sheet until it is sold, at which point the proceeds from the sale are recognized as a gain or loss in the company's income statement.