Question
On January 2, 2019, All Good Company purchased 11,000 shares of the stock of Big Bad Company, and DID NOT obtain significant influence. The investment
On January 2, 2019, All Good Company purchased 11,000 shares of the stock of Big Bad Company, and DID NOT obtain significant influence. The investment is intended as a long-term investment. The stock was purchased for $16 per share, and represents a 10% ownership stake. Big Bad Company made $400,000 of net income in 2019, and paid dividends to All Good Company of $5,000 on December 15, 2019. On December 31, 2019, Big Bad Company's stock was trading on the open market for $10.50 per share at the end of the year. Use this information to determine the unrealized gain or loss on the investment that should be reported at year end by All Good Company. If it is a loss, enter as a negative number. Round to nearest whole dollar.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started