1. Gaw Company owns 15% of the common stock of Trace Corporation and used the fair- value method to account for this investment. Trace reported net income of $110,000 for 2011 and paid dividends of S60,000 on October 1, 2011. How much income should Gaw recognize on this investment in 20112 A. S16,500. B. $9,000. C. $25,500. D. S7,500 E. $50,000