Question 23:

Stiller Company, an 80% owned subsidiary of Leo Company, purchased land from Leo on March 1, 2017, for $75,000. The land originally cost Leo $60,000. Stiller reported net income of $125,000 and $140,000 for 2017 and 2018, respectively. Leo uses the equity method to account for its investment. Assuming there are no excess amortizations or other intra-entity transactions, compute income from Stiller on Leo's books for 2017.

$88,000.

$110,000

$85,000.

$125,000.

$100,000.