Question
A company A pays $1,000,000 for 30% of the voting stock of Company B in 2020. In 2020, B reports net income of $500,000 and
A company A pays $1,000,000 for 30% of the voting stock of Company B in 2020.
In 2020, B reports net income of $500,000 and dividends of $75,000.
In 2021, B reports net income of $300,000 and dividends of $100,000.
What does Company A record the investment and how does it adjust it on balance sheet?
What does Company A report on the balance sheet for its investment in B at the end of 2021?
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