6 and 7 show solution

losses. 1. Puckett Company paid $1.6 million for 50.000 shares of Harrison's voting con which represents a 40 percent investment. No allocation to goodwill or other specific accoun stock, which represents a 40 percent inve was made. Signific de. Significant influence over Harrison is achieved by this acquisition and so Puckett applies the equity method. Harrison declared a Spe hod. Harrison declared a $2 per share dividend during the year and reported net income of $560.000. What is the balance in the Investment hat is the balance in the Investment in Harrison account found in Puckett's financial records as of December 31? a. $1,724.000 b. $1,784,000 c. $1.844.000 d. $1,884,000 . In January 2017, Domingo, Inc., acquired 20 percent of the outstanding common stock of Mar- tes, Inc., for $700,000. This investment gave Domingo the ability to exercise significant influence over Martes, whose balance sheet on that date showed total assets of $3,900,000 with liabilities of $900,000. Any excess of cost over book value of the investment was attributed to a patent having a remaining useful life of 10 years. In 2017. Martes reported net income of $170,000. In 2018, Martes reported net income of $210,000. Dividends of $70,000 were declared in each of these two years. What is the equity method balance of Domingo's Investment in Martes, Inc., at December 31, 2018? a. $728.000 b. $748.000 c. $756,000 d. $776,000