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Q10- Company P purchased 40% stock in Company S on Jan 1, 20X1 for $200.000. The net
income of Company S and the dividend paid by it in the year 20X1 is $80,000 and $30,000
respectively. The fair value of the P's investment the end of year 20X1 is 225,000. Under the
Equity method, the increase in the total net income of P related to its investment in Company S,
for the year 20X1 will be:
a- $37,000
b- $25,000
c- $57,000
d- $32,000
With calculations pleas

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Q10- Company P purchased 40 stock in Company S on Jan 1, 20X1 for $.pdf

  • 1. Q10- Company P purchased 40% stock in Company S on Jan 1, 20X1 for $200.000. The net income of Company S and the dividend paid by it in the year 20X1 is $80,000 and $30,000 respectively. The fair value of the P's investment the end of year 20X1 is 225,000. Under the Equity method, the increase in the total net income of P related to its investment in Company S, for the year 20X1 will be: a- $37,000 b- $25,000 c- $57,000 d- $32,000 With calculations pleas