Equity method mechanics with other comprehensive income An Investor company owns 40% of the outstanding common stock of an Investee company, which allows the investor to exercise signiflcant influence over the Investee. The Equity Investment was reported at $950,000 as of the end of the previous year. During the year, the investor received dividends of $100,000 from the Investee. The investee reports the followine income statement for the year: Revenues $2,600,000 Expenses 1,800,000 Net income 800,000 Other comprehensive income 100,000 Comprehensive income $900,000 a. How much equity Income should the investor report in its net income (1.e., as part of the current year Income statement)? $ 320000 b. What amount should the investor report for the Equity Investment in Its balance sheet at the end of the year?
Equity method mechanics with other comprehensive income An Investor company owns 40% of the outstanding common stock of an Investee company, which allows the investor to exercise signiflcant influence over the Investee. The Equity Investment was reported at $950,000 as of the end of the previous year. During the year, the investor received dividends of $100,000 from the Investee. The investee reports the followine income statement for the year: Revenues $2,600,000 Expenses 1,800,000 Net income 800,000 Other comprehensive income 100,000 Comprehensive income $900,000 a. How much equity Income should the investor report in its net income (1.e., as part of the current year Income statement)? $ 320000 b. What amount should the investor report for the Equity Investment in Its balance sheet at the end of the year?
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter2: Financial Statements And The Annual Report
Section: Chapter Questions
Problem 2.9E: Statement of Retained Earnings Landon Corporation was organized on January 2, 2014, with the...
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