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CFA Level 2
Financial Reporting and Analysis

Equity Method Carrying Amount Calculation

Very Hard Intercorporate Investments Equity Method

Alyssa owns 30% of GHI Corporation, an investment she accounts for using the equity method. During the financial year, GHI reports a net income of $1.5 million and declares a dividend of $0.6 million. Additionally, GHI's market value at the end of the year is $10 million. Alyssa's initial investment in GHI was $2 million. At year-end, what is the carrying amount of Alyssa's investment in GHI, considering the equity method?

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