On January 2, 2020, Black Company purchased 17% of Rock Company's common stock for $51,000. Rock's net income for the years ended December 31, 2020, and December 31, 2021, were $15,000 and $59,000, respectively. During 2020, Rock declared and paid a dividend of $67,500. On December 31, 2020, the fair value of the Rock stock owned by Black had increased to $69,000. How much should Black show in the 2020 income statement as income from this investment? Multiple Choice $29,475. There is no correct answer. $24,000. $11,475. $18,000. < Prev 8 of 16 Next >

Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA2: Investments
Section: Chapter Questions
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On January 2, 2020, Black Company purchased 17% of Rock Company's common stock for $51,000. Rock's net income for the years ended December 31,
2020, and December 31, 2021, were $15,000 and $59,000, respectively. During 2020, Rock declared and paid a dividend of $67,500. On December 31,
2020, the fair value of the Rock stock owned by Black had increased to $69,000. How much should Black show in the 2020 income statement as
income from this investment?
Multiple Choice
$29,475.
There is no correct answer.
$24,000.
$11,475.
$18,000.
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Transcribed Image Text:On January 2, 2020, Black Company purchased 17% of Rock Company's common stock for $51,000. Rock's net income for the years ended December 31, 2020, and December 31, 2021, were $15,000 and $59,000, respectively. During 2020, Rock declared and paid a dividend of $67,500. On December 31, 2020, the fair value of the Rock stock owned by Black had increased to $69,000. How much should Black show in the 2020 income statement as income from this investment? Multiple Choice $29,475. There is no correct answer. $24,000. $11,475. $18,000. <Prev 8 of 16 Next > ME MacBook Air
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