On December 3 1 , 2 0 2 2 , Akron, Incorporated, purchased 5 percent of Zip Company's common shares on the open market in exchange for $ 1 5 , 6 0 0 On December 3 1 , 2 0 2 3 , Akron, Incorporated, acquires an additional 2 5 percent of Zip Company's outstanding common stock for $ 9 7 , 0 0 0 During the next two years, the following information is available for Zip Company At December 3 1 , 2 0 2 3 , Zip reports a net book value of $ 2 9 8 , 0 0 0 Akron attributed any excess of its 3 0 percent share of Zip's fair over book value to its share of Zip's franchise agreements The franchise agreements had a remaining life of 1 0 years at December 3 1 , Required a Assume Akron applies the equity method to its Investment in Zip account What amount of equity income should Akron report for 2 0 2 4 On Akron's December 3 1 , 2 0 2 4 , balance sheet, what amount is reported for the Investment in Zip account b Assume Akron uses fair value accounting for its Investment in Zip account What amount of income from its investment in Zip should Akron report for 2 0 2 4 On Akron's December 3 1 , 2 0 2 4 , balance sheet, what amount is reported for the Investment in Zip account a 1 Equity income a 2 Investment in Zip account b 1 Reported income b 2 Investment in Zip account

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Question: On December 3 1 , 2 0 2 2 , Akron, Incorporated, purchased 5 percent of Zip Company's common shares on the open market in

On December

31, 2022,

Akron, Incorporated, purchased

5

percent of Zip Company's common shares on the open market in exchange

for $

15, 600 .

On December

31, 2023,

Akron, Incorporated, acquires an additional

25

percent of Zip Company's outstanding common

stock for $

97, 000 .

During the next two years, the following information is available for Zip Company:

At December

31, 2023,

Zip reports a net book value of $

298, 000 .

Akron attributed any excess of its

30

percent share of Zip's fair over

book value to its share of Zip's franchise agreements. The franchise agreements had a remaining life of

10

years at December

31,

Required:

.

Assume Akron applies the equity method to its Investment in Zip account:

What amount of equity income should Akron report for

2024 ?

On Akron's December

31, 2024,

balance sheet, what amount is reported for the Investment in Zip account?

.

Assume Akron uses fair

-

value accounting for its Investment in Zip account:

What amount of income from its investment in Zip should Akron report for

2024 ?

On Akron's December

31, 2024,

balance sheet, what amount is reported for the Investment in Zip account?

1 .

Equity income

2 .

Investment in Zip account

1 .

Reported income

2 .

Investment in Zip account

On December 31,2022, Akron, Incorporated, purchased 5 percent of Zip Company's

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