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Phillips Company bought 30 percent ownership in Jones Bag Company on January 1, 20X1, at underlying

Phillips Company bought 30 percent ownership in Jones Bag Company on January 1, 20X1, at underlying book value. In 20X1, 20X2, and 20X3, Jones Bag reported the following:

Year Net Income Dividends
20X1 $15,000 $22,000
20X2 $19,000 $17,000
20X3 $27,000 $17,000

The balance in Phillips Company’s investment account on December 31, 20X3, was $73,000.

Required: In each of the following independent cases, determine the amount that Phillips paid for its investment in Jones Bag stock assuming that Phillips accounted for its investment using the cost method and equity method.$ 15,000 $ 22,000 20X2 19,000 17,000 20X3 27,000 17,000

Apr 04 2020 View more View Less

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