On January 3, 2011, Haskins Corporation acquired 40 percent of the outstanding common stock of Clem Company

Question:

On January 3, 2011, Haskins acquired 40 percent of the outstanding of Clem Company for $990,000. This acquisition gave Haskins the ability to exercise significant influence over the investee. The book value of the acquired shares was $790,000. Any excess cost over the underlying book value was assigned to a patent that was undervalued on Clem's balance sheet. This patent has a remaining useful life of 10 years. For the year ended December 31, 2011, Clem reported net income of $260,000 and paid cash dividends of $80,000. At December 31, 2011, what should Haskins report as its investment in Clem under the equity method?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...