Question
Carla Vista, Inc. acquired 30% of Metlock Corporation's voting stock on January 1, 2021 for $950000. During 2021, Metlock earned $385000 and paid dividends
Carla Vista, Inc. acquired 30% of Metlock Corporation's voting stock on January 1, 2021 for $950000. During 2021, Metlock earned $385000 and paid dividends of $240000. Carla Vista's 30% interest in Metlock gives Carla Vista the ability to exercise significant influence over Metlock's operating and financial policies. During 2022, Metlock earned $485000 and paid cash dividends of $140000 on April 1 and $140000 on October 1. On July 1, 2022, Carla Vista sold half of its stock in Metlock for $645000 cash. The carrying amount of this investment in Carla Vista's December 31, 2021 balance sheet should be $1095500. $1065500. $993500. $950000.
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