company owns 40% of S Corporation and During the year S had net income of 200000 and paid dividends of 50000. Pused the cost method of accounting What effect would this have on the investment account and net income and retained earnings respectively? Select one: O a. understate, understate, understate O b. overstate, understate, understate O c. overstate, overstate, overstate d. understate, overstate, overstate.
company owns 40% of S Corporation and During the year S had net income of 200000 and paid dividends of 50000. Pused the cost method of accounting What effect would this have on the investment account and net income and retained earnings respectively? Select one: O a. understate, understate, understate O b. overstate, understate, understate O c. overstate, overstate, overstate d. understate, overstate, overstate.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter5: The Income Statement And The Statement Of Cash Flows
Section: Chapter Questions
Problem 8RE
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Transcribed Image Text:P company owns 40% of S Corporation and During the year S had net income of 200000 and paid dividends
of 50000, P used the cost method of accounting What effect would this have on the investment account
and net income and retained earnings respectively?
Select one:
O a. understate, understate, understate
O b. overstate, understate, understate
O c. overstate, overstate, overstate
O d. understate, overstate, overstate.
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