Equity method mechanics An investor company owns 25% of the outstanding common stock of an investee company, which allows the investor to exercise significant influence over the investee. The Equity Investment was reported at $400,000 as of the end of the previous year. During the year, the investor received dividends of $48,000 from the investee. The investee reports the following income statement for the year: Revenues $1,600,000 Expenses 1,280,000 Net income $320,000 Required a. How much equity income should the investor report in its income statement? $ b. What amount should the investor report for the Equity Investment in its balance sheet at the end of the year? $

Equity method mechanies An imvestor company owns \25 of the outstanding common stock of an investee compary, which allows the investor to exercise significant influence over the investee. The Equity imvestment was reported at \\( \\$ 400,000 \\) as of the end of the previous year. During the year, the investor received dividends of \\( \\$ 48,000 \\) from the investee. The investee reports the following income statement for the year: Required a. How much equity income should the investor report in its income statement? b. What amount should the imvestor report for the Equity imvestment in iss balance sheet at the end of the year