Rijo Corporation uses the equity method to account for its ownership of 30% of the common stock
Question:
Rijo Corporation uses the equity method to account for its ownership of 30% of the common stock of Pippen Packing. During 2014, Pippen reported a net income of $80,000 and declares and pays cash dividends of $10,000. What recognition should Rijo Corporation give to these events?
Step by Step Answer:
R ij o Corporation should recognize the 80 000 of net inco...View the full answer
Financial and managerial accounting
ISBN: 978-1118016114
1st edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Related Video
Stocks (also known as equities) are securities that represent ownership in a company. They are issued by companies to raise capital, and when an individual buys stocks, they become a shareholder in that company. Investing in stocks can be a way for individuals to potentially earn a return on their investment through dividends and capital appreciation. However, investing in stocks also carries a level of risk, as the value of the stock can fluctuate based on various factors such as the financial performance of the company and general market conditions. For companies, issuing stocks can be a way to raise funds for growth and expansion. When a company goes public by issuing an initial public offering (IPO), it can raise significant capital by selling ownership stakes to the public. Companies can also issue additional stock offerings to raise additional capital as needed.
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