Question: On January 2 , 2 0 1 6 , Howdy Doody Corporation purchased ( 1 2 % ) of Ranger Corporation's common stock for $

On January 2,2016, Howdy Doody Corporation purchased (12%) of Ranger Corporation's common stock for $50,000 and classified the investment as avaliable for sale. Ranger's net income for the years ended December 31,2016 and 2017, were $10,000 and $50,000, respectively. During 2017, Ranger declared and paid a dividend of $60,000. There were no dividends in 2016. On December 31,2017, the fair value of the Ranger stock owned by Howdy Doody had increased to $55,000. How much should Howdy Doody show in the 2017 income statement as income from this investment if, at the end of 2016, the Fair Value Adjustment had a credit balance of $2,000?
On January 2 , 2 0 1 6 , Howdy Doody Corporation

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