measurement alternative

Assets2

1. 321-10Overall321 Investments—Equity Securities

   ASC 321-10 governs the accounting for investments in equity securities and other ownership interests (partnerships, unincorporated joint ventures, LLCs) that are not consolidated, not accounted for under the equity method, and not derivatives. The default rule is fair value measurement in the balance sheet with all unrealized holding gains and losses (and dividend income) recognized in earnings (321-10-35-1, 35-6). As an alternative, an entity may elect, investment by investment, a "measurement alternative" for an equity security without a readily determinable fair value: cost minus impairment, adjusted up or down for observable price changes in orderly transactions for identical or similar investments of the same issuer (321-10-35-2).

2. 325-20Cost Method Investments325 Investments—Other

   ASC 325-20 formerly governed the cost method of accounting for equity securities without a readily determinable fair value (cost-method investments), including their initial measurement, impairment assessment, and disclosure. Every substantive paragraph in the subtopic was superseded by ASU 2016-01, so the subtopic is now an empty shell with no operative guidance. Equity investments previously accounted for under the cost method are now within the scope of ASC 321, Investments—Equity Securities.