Assume that Horicon Corp acquired 25% of the common stock of Sheboygan Corp.on January 1, 2015, for $300,000. During 2015, Sheboygan Corp. reported netincome of $160,000 and paid total dividends of $60,000. If Horicon uses theequity method to account for its investment, the balance in the investmentaccount on December 31, 2015, will be:

Equity method accounts for balance in investment account by taking into consideration both net…

Answered: equity method to account for its…

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equity method to account for its investment, the balance in the investment account on December 31, 2015, will be:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Assume that Horicon Corp acquired 25% of the common stock of Sheboygan Corp.
on January 1, 2015, for $300,000. During 2015, Sheboygan Corp. reported net
income of $160,000 and paid total dividends of $60,000. If Horicon uses the
equity method to account for its investment, the balance in the investment
account on December 31, 2015, will be:

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