Question: On January 1 Puckett Company paid 1 6 million for 50 000

On January 1, Puckett Company paid $1.6 million for 50,000 shares of Harrison’s voting common stock, which represents a 40 percent investment. No allocation to goodwill or other specific account was made. Significant influence over Harrison is achieved by this acquisition and so Puckett applies the equity method. Harrison declared a $2 per share dividend during the year and reported net income of $560,000. What is the balance in the Investment in Harrison account found in Puckett’s financial records as of December 31?
a. $1,724,000.
b. $1,784,000.
c. $1,844,000.

View Solution:

Sale on SolutionInn
  • CreatedJanuary 08, 2015
  • Files Included
Post your question