Question
Two months ago, RRR purchased 40% of the outstanding voting shares of Heplun Incorporated, a public company specializing in server distribution. Heplun is a fastgrowing
Two months ago, RRR purchased 40% of the outstanding voting shares of Heplun Incorporated, a public company specializing in server distribution. Heplun is a fastgrowing business, engaged in extensive research and development. Given RRR's expertise, Heplun pays RRR a set fee, on a quarterly basis, for strategic guidance on R&D initiatives. The two companies have an agreement that RRR must approve all new major R&D projects that Heplun engages in. Heplun recently expressed to RRR concerns over the stability of its financial policies and the desire to gain more consistency to enhance the value of the company for stakeholders. RRR agreed to provide the necessary direction to Heplun for an additional monthly fee. RRR is allowed one board seat on Heplun's board of directors; the other 11 board members are not from RRR. The remaining 60% of Heplun's shares are held by the general public with no individual shareholder owning more than 1%. RRR needs to find an appropriate way to record the investment in Heplun
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