At the beginning of the year, the Lisa’s Brewery purchased a 25 percent ownership interest in Down Under Brewery of Brisbane, Australia. The investment cost $15 million. At year-end, Down Under Brewery declared and paid cash dividends to shareholders totaling $400,000, after reporting earnings of $2.5 million. A. Calculate the income statement effect of Lisa’s’s investment in Down Under Brewery as of year-end. B. Calculate the book value of Lisa’s equity investment in Down
At the beginning of the year, the Lisa’s Brewery purchased a 25 percent ownership interest in Down Under Brewery of Brisbane, Australia. The investment cost $15 million. At year-end, Down Under Brewery declared and paid cash dividends to shareholders totaling $400,000, after reporting earnings of $2.5 million.
A. Calculate the income statement effect of Lisa’s’s investment in Down Under Brewery as of year-end.
B. Calculate the book value of Lisa’s equity investment in Down Under Brewery at year-end.
C. Calculate the book value of Lisa’s equity investment in Down Under Brewery at year-end
assuming that Down Under reported a loss of $1.5 million instead of a profit of $2.5 million and still paid its dividend of $400,00
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