Kim Company bought 30% of the shares of Phelps, Inc., at the start of 2016. Kim paid

Question:

Kim Company bought 30% of the shares of Phelps, Inc., at the start of 2016. Kim paid $10 million for the shares. Thirty percent of the book value of Phelps's net assets is $8 million, and the difference of $2 million is due to land that Phelps owns that has appreciated in value. During 2016, Phelps reported net income of $1 million and paid a cash of $0.5 million. At what amount does Kim carry the Phelps investment on its as of December 31, 2016?
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Dividend
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