On January 1, 2018, Investor Ltd. purchased a 15% interest in the common shares of Investee Ltd. for $60,000. Investee Ltd. reported net incomes and paid dividends as follows:

2018 – net income $40,000; dividends paid $50,000
2019 – net income $85,000; dividends paid $70,000

Assume that Investor Ltd. uses the cost method to account for its investment in Investee Ltd. A balance sheet for Investor Ltd. at December 31, 2019 would report "Investment in Investee Ltd." at:

A) $60,000

B) $60,750

C) $59,250

D) $58,500

Answer rating: 100% (QA)

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