An investor company owns 25% of the common stock of an investee company. The investor has significant influence over the investee. During the year ended December 31, 2022, the investee bought $120,000 of inventory from the investor. The investor includes gross profit of 35% on all inventory sales transactions. At December 31, 2022, the investee held $200,000 of total inventory, with $40,000 of this inventory purchased from the investor during 2022. For the year ended December 31, 2022, the investor
and investee reported $100,000 and $50,000, respectively, of net income. What amount of investment income from the investee did the investor recognize during the year ended December 31, 2022?

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To calculate the investment income recognized by the investor from the investee for the year ended D... View the full answer