Canoga Co. has owned 18% of Winnetka, Inc., for the past several years. This ownership did not

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Question:

Canoga Co. has owned 18% of Winnetka, Inc., for the past several years. This ownership did not allow Canoga to have significant influence over Winnetka. Which of the following affects the income the Canoga recognizes from its ownership of the Winnetka?

1. Winnetka's reported income adjusted for excess cost over book value amortizations.

2. Intra-entity profits from downstream sales.

3. Loss from discontinued operations of Winnetka.

4.Canoga's share of cash dividends received from Winnetka.

5.Intra-entity profits from upstream sales.

6.Other comprehensive income reported by Winnetka.