On January 1, 2021, Point, Inc. purchased 10% of lona Co.'s common stock. Point purchased additional shares bringing its ownership up to 40% of lona's common stock outstanding on August 1, 2021: During October 2021, lona declared and paid a cash dividend on all of its outstanding common stock. Using PFRSS, how much income from the lona investment should Point's 2021 income statement report? O 10% of lona's income for January 1 to July 31, 2021, plus 40% of lona's income for August 1 to December 31, 2021. O 40% of lona's income for August 1 to December 31, 2021 only. O 40% of lona's 2021 income. O Amount equal to dividends received from lona.
On January 1, 2021, Point, Inc. purchased 10% of lona Co.'s common stock. Point purchased additional shares bringing its ownership up to 40% of lona's common stock outstanding on August 1, 2021: During October 2021, lona declared and paid a cash dividend on all of its outstanding common stock. Using PFRSS, how much income from the lona investment should Point's 2021 income statement report? O 10% of lona's income for January 1 to July 31, 2021, plus 40% of lona's income for August 1 to December 31, 2021. O 40% of lona's income for August 1 to December 31, 2021 only. O 40% of lona's 2021 income. O Amount equal to dividends received from lona.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On January 1, 2021, Point, lInc. purchased 10% of lona Co.'s common stock. Point purchased additional shares bringing
its ownership up to 40% of lona's common stock outstanding on August 1, 2021. During October 2021, lona declared
and paid a cash dividend on all of its outstanding common stock. Using PFRSS, how much income from the lona
investment should Point's 2021 income statement report?
O 10% of lona's income for January 1 to July 31, 2021, plus 40% of lona's income for August 1 to December 31, 2021.
O 40% of lona's income for August 1 to December 31, 2021 only.
O 40% of lona's 2021 income.
O Amount equal to dividends received from lona.
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