Question
Nielsen Corporation paid $38,900 for a 5 percent interest in Goldblum Corp. on January 1, 2018, when Goldblum's stockholders' equity was a total of $958,000.
Nielsen Corporation paid $38,900 for a 5 percent interest in Goldblum Corp. on January 1, 2018, when Goldblum's stockholders' equity was a total of $958,000. On December 31, 2019, after receipt of the year's dividends from Goldblum, Nielsen paid $289,870 for an additional 19 percent interest in Goldblum Corp. Both of Nielsen's investments were made when Goldblum's book values equaled their fair values. Goldblum's net income and dividends for 2018 and 2019 were as follows:
Year | 2018 | 2019 |
Net income | $80,000 | $118,000 |
Dividends | $40,000 | $43,000 |
If Goldblum had $117,000 income for 2020, prepare Nielsen's entry to record its share of income for 2020.
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