On January 1, 2021, Fisher Corporation paid $2,877,000 for 35 percent of the outstanding voting stock of Steel, Inc., and appropriately applied the equity method for its investment. Any excess of cost over Steel's book value was attributed to goodwill. During 2021, Steel reports $808,000 in net income and a $997,000 other comprehensive income loss. Steel also declares and pays $21,000 in dividends. a. What amount should Fisher report as its Investment in Steel on its December 31, 2021, balance sheet? b. What amount should Fisher report as Equity in Earnings of Steel on its 2021 income statement? Answer is complete but not entirely correct. a. Investment b. Equity in earnings $ 2,809,500 x $ 282,800✔

On January 1, 2021, Fisher Corporation paid $2,877,000 for 35 percent of the outstanding voting stock of Steel, Inc., and appropriately applied the equity method for its investment. Any excess of cost over Steel's book value was attributed to goodwill. During 2021, Steel reports $808,000 in net income and a $997,000 other comprehensive income loss. Steel also declares and pays $21,000 in dividends. a. What amount should Fisher report as its Investment in Steel on its December 31, 2021, balance sheet? b. What amount should Fisher report as Equity in Earnings of Steel on its 2021 income statement? Answer is complete but not entirely correct. a. Investment b. Equity in earnings $ 2,809,500 x $ 282,800✔

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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