Question
On January 2, 2020, Howdy Doody Corporation purchased 18% of Ranger Corporation's common stock for $57,000. Ranger's net income for the years ended December 31,
On January 2, 2020, Howdy Doody Corporation purchased 18% of Ranger Corporation's common stock for $57,000. Ranger's net income for the years ended December 31, 2020, and December 31, 2021, were $14,000 and $56,000, respectively. During 2020, Ranger declared and paid a dividend of $67,000. On December 31, 2020, the fair value of the Ranger stock owned by Howdy Doody had increased to $74,000. How much should Howdy Doody show in the 2020 income statement as income from this investment?
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
