Agani Financial paid $580,000 for a 35% investment in the common stock of Clipper, Inc. For the first year, Clipper reported net income of $185,000 and at year-end declared and paid cash dividends of $120,000. On the balance-sheet date, the fair value of Agani's investment in Clipper stock was $380,000. Requirements 1. Which method is appropriate for Agani Financial to use in accounting for its investment in Clipper, Inc.? Why? Requirement 1. Which method is appropriate for Agani Financial to use in accounting for its investment in Clipper? Why? It would be appropriate for Agani to use the equity method of recording its investment in Clipper, Inc. With a holding of this size, 35% of the common stock, it is probable that Agani can exercise significant influence on the operations of Clipper, Inc. Requirement 2. Show everything that Agani would report for the investment and any investment revenue in its year-end financial statements. Balance Sheet (partial): Assets Long-term assets Equity method investment Income Statement (partial)