Excellence Auto Inc. (EAI) has 150,000 shares issued in total. Assume that on January 1, 2021, Power One Corporation acquired 15% of EAI's shares for $45 per share. Power One is assumed not to have significant influence over EAI and will use the cost method to account for its investments. For the year ended December 31, 2021, EAI reported profit of $800,000 and declared and paid $80,000 cash dividends. At December 31, 2021, EAI's common shares were traded at $50 each. How much is Power One required to record in its dividend revenue account in EAI? O $132,000 O $120,000 O $12,000 O $80,000

Excellence Auto Inc. (EAI) has 150,000 shares issued in total. Assume that on January 1, 2021, Power One Corporation acquired 15% of EAI's shares for $45 per share. Power One is assumed not to have significant influence over EAI and will use the cost method to account for its investments. For the year ended December 31, 2021, EAI reported profit of $800,000 and declared and paid $80,000 cash dividends. At December 31, 2021, EAI's common shares were traded at $50 each. How much is Power One required to record in its dividend revenue account in EAI? O $132,000 O $120,000 O $12,000 O $80,000

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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