Create an Account

Already have account?

Forgot Your Password ?

Home / Questions / In January 2014 Domingo Inc acquired 20 percent of the outstanding common stock of Martes ...

In January 2014 Domingo Inc acquired 20 percent of the outstanding common stock of Martes Inc for $700000 This investment gave Domingo the ability to exercise significant influence over

In January 2014, Domingo, Inc., acquired 20 percent of the outstanding common stock of Martes, Inc., for $700,000. This investment gave Domingo the ability to exercise significant influence over Martes. Martes’s assets on that date were recorded at $3,900,000 with liabilities of $900,000. Any excess of cost over book value of the investment was attributed to a patent having a remaining useful life of 10 years. In 2014, Martes reported net income of $170,000. In 2015, Martes reported net income of $210,000. Dividends of $70,000 were declared in each of these two years. What is the equity method balance of Domingo’s Investment in Martes, Inc., at December 31, 2015?

a. $728,000.

b. $748,000.

c. $756,000.

d. $776,000.

Jul 22 2020 View more View Less

Answer (Solved)

question Subscribe To Get Solution

Related Questions