Question 22 (4 points) Smith, Inc. uses the Simple Equity Method to account for the net income of Redstone, Inc., a company Smith, Inc. owns 100 % of the outstanding stock of. When Redstone, Inc. reports quarterly Net Income of $80,000 on 6/30/19, Smith, Inc. will: a) Debit the Investment and Credit Investment Income $80,000 b) Debit Investment Income and Credit the Inivestment $80,000 O c) Smith, Inc. will make no journal entry resulting from this transaction d) Debit Dividends Receivable and Credit Investment Income $20,000 as it's only for a quarter of the year Company P purchased 100 % of the outstanding common stock of Company S on 1/1/19 for $700,000 in cash and stock. Company P accounts for the income of Company S using the Simple Equity Method, and during the year Company S reported Net Income of $100,000 and declared and paid dividends of $70,000. Assuming no other transaction between the two companies, the balance in "Investment in Company S" on the books of Company P on 12/31/19 will be: O a) $730,000 b) $0 O c) $600,000 d) $630,000