FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Monty Co. invested $920,000 in Flounder Co. for 25% of its outstanding stock. Flounder Co. pays out 40% of net income in dividends each year.
Use the information in the following T-account for the investment in Flounder to answer the following questions.
|
Investment in Flounder Co.
|
|
|---|---|
| 920,000 | |
| 110,000 | |
| 44,000 |
(a) How much was Monty Co.’s share of Flounder Co.’s net income for the year?
(b) What was Flounder Co.’s total net income for the year?
(c) What was Flounder Co.’s total dividends for the year?
(d) How much was Monty Co.’s share of Flounder Co.’s dividends for the year?
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