A firm purchased noninfluential and noncontrolling stock investments for $65,000. The firm does not intend to sell the investments in the near future. During the year, the firm received dividends totaling $4,000 from these stock investments. At year-end, the stock portfolio had a quoted market value of $68,000. The increase in net income for the year from these stock investments is:

a. $1,000.

b. $3,000.

c. $4,000.

d. $7,000.

Artway Company purchased 30 percent of the voting stock of Barton Company for $60,000 on January 1. During the year, Barton Company earned $50,000 net income and paid $15,000 in dividends. At the end of the year, Artway Companys account, Stock Investment-Influential (Barton) should have a balance of:

a. $110,000.

b. $70,500.

c. $95,000.

d. $60,000.

The proper category to classify an investment in equity securities depends on:

a. Managements intentions with regard to when to sell the investment.

b. The relative easy to sell the invenstment.

c. The ability of the purchasing company to influence the investee company.

d. All of the above.

Where would the account unrealized gain/loss on investment appear for trading security investment?

a. Income Statement.

b. Equity section of the Balance Sheet.

c. Statement of Cash Flows.

d. It does not appear on any statement.

Controlling securities typically require the investor to acquire what percent of the investee company common stock?

a. Under 20 percent.

b. Between 20 and 50 percent.

c. Over 50 percent.

d. 100 percent.