Joint Venture

What is Joint Venture? | Features of Joint Venture

A joint venture is a business arrangement between two parties where they agree to develop a business relationship (whether or not through a new entity). Under the terms of their joint venture agreement, both parties contribute equity and run the operations. Ultimately both parties share revenue, expense, and profits as per their pre-defined formula.

Investment in joint ventures is consolidated through the equity method as described above in the case of associated companies.

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