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.. Best Billiard Company owns 40% of Supreme Table Company's stock at a historical cost of $300,000. Supreme Table recently reported their earnings for the
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Best Billiard Company owns 40% of Supreme Table Company's stock at a historical cost of $300,000. Supreme Table recently reported their earnings for the prior year. Best Billiard's proportional share of Supreme Table's prior year net income was $10,000. Best Billiard also received $15,000 in dividends from Supreme Table in the prior year. Best Billiard uses the equity method as the accounting treatment for this investment. Based on the information presented, the proper presentation of this investment would result in Best Billiard reporting a. a decrease in the book value of their investment in Supreme Table. b. an increase in the book value of their investment in Supreme Table. c. their investment in Supreme Table at the original cost. d. consolidated financial statements with Supreme TableStep by Step Solution
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