116On January 1, 2024, Clor-Proell Enterprises bought 20% of the outstanding common stock of Chen Construction Company for $600million cash. Chen's net income for the year ended December 31, 2024, was $300 million. During 2024, Chen declared and paid cashdividends of $60 million. Clor-Proell recorded the investment as follows:pointsPURCHASEGeneral Journal($ in millions)DebitCreditInvestment in Chen Construction sharesCash600600eBookNET INCOMEInvestment in Chen Construction shares (20% x $300 million)60Investment revenue60DIVIDENDSHintCash (20% x $60 million)12Investment in Chen Construction shares12Required:PrintReferencesWhat would be the pretax amounts related to the investment that Clor-Proell would report in its statement of cash flows for the yearended December 31, 2024?Note: Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Cash outflows should be indicated with a minussign.Operating activities$600Investing activities$60Financing activities$12

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Answered: 1 16 On January 1, 2024, Clor-Proell…

Cornerstones of Financial Accounting

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ChapterA2: Investments

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On January 1, 2024, Clor-Proell Enterprises bought 20% of the outstanding common stock of Chen Construction Company for $600 million cash. Chen's net income for the year ended December 31, 2024, was $300 million. During 2024, Chen declared and paid cash dividends of $60 million. Clor-Proell recorded the investment as follows: PURCHASE General Journal Investment in Chen Construction shares Cash NET INCOME ($ in millions) Debit Credit 600 600 Investment in Chen Construction shares (20% x $300 million) 60 Investment revenue 60 DIVIDENDS Cash (20% x $60 million) 12 12 Investment in Chen Construction shares Required: What would be the pretax amounts related to the investment that Clor-Proell would report in its statement of cash flows for the year ended December 31, 2024? Note: Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Cash outflows should be indicated with a minus sign. Operating activities $ 600 Investing activities $ 60 Financing activities $ 12
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