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On December 3 1 , 2 0 2 2 , Akron, Incorporated, purchased 5 percent of Zip Company's common shares on the open market in
On December Akron, Incorporated, purchased percent of Zip Company's common shares on the open market in exchange
for $ On December Akron, Incorporated, acquires an additional percent of Zip Company's outstanding common
stock for $
During the next two years, the following information is available for Zip Company:
At December Zip reports a net book value of $ Akron attributed any excess of its percent share of Zip's fair over
book value to its share of Zip's franchise agreements. The franchise agreements had a remaining life of years at December
Required:
a Assume Akron applies the equity method to its Investment in Zip account:
What amount of equity income should Akron report for
On Akron's December balance sheet, what amount is reported for the Investment in Zip account?
b Assume Akron uses fairvalue accounting for its Investment in Zip account:
What amount of income from its investment in Zip should Akron report for
On Akron's December balance sheet, what amount is reported for the Investment in Zip account?
a Equity income
a Investment in Zip account
b Reported income
b Investment in Zip account
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