When these type of stock acquisitions (INVESTMENTS)occur One company buying stoc

Question

When these type of stock acquisitions (INVESTMENTS)occur One company buying stock of another the volume of stock acquired can fall into 3 catagories. NonINFLUENTIAL INFLUENTIAL CONTROLLING INFLUENCE THERE ARE DIFFERENT ACCOUNTING TRATMENTS FOR EACH TYPE----FOCUS ON NON INFLUENTIAL VS INFLUENTIAL REPORTING........ Again....Corp. A bought Corp X stock.....for $ 100,000. Corp X had net Income of 1,000,000 this year. They declared cash dividends and Corp A received $2500 in Dividends via check...... Value of the investment Account to start is $100,000. What is the balance of the 3 accounts listed at the end of this year 10% INTERST IN Co.X 25% INTEREST IN CoX

Explanation / Answer

$347500

($100000 + $250000 - $2500)

NUMBER DIVIDEND INCOME EARNNING FROM INVESTMENT INVESTMENT BALANCE 1. $2500 $2500 $100000 2. $2500 $252500 ($2500 + 25% OF $100000)

$347500

($100000 + $250000 - $2500)

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