Phast Corporation owns a 80% interest in Stechno Company, acquired several years ago at a cost equal to book value and fair value. Stechno sells merchandise inventory to Phast for the first time in 2019, and some is unsold at December 31, 2019. In computing income from the investee for 2019 under the equity method, Phast uses which equation? Select one: O a. 80% of Stechnos income less 100% of the unrealized profit in Phasts ending inventory O b. 80% of Stechnos income plus 100% of the unrealized profit in Phasts ending inventory O c. 80% of Stechnos income less 80% of the unrealized profit in Phasts ending inventory O d. 80% of Stechnos income plus 80% of the unrealized profit in Phasts ending inventory

Phast Corporation owns a 80% interest in Stechno Company, acquired several years ago at a cost equal to book value and fair value. Stechno sells merchandise inventory to Phast for the first time in 2019, and some is unsold at December 31, 2019. In computing income from the investee for 2019 under the equity method, Phast uses which equation? Select one: O a. 80% of Stechnos income less 100% of the unrealized profit in Phasts ending inventory O b. 80% of Stechnos income plus 100% of the unrealized profit in Phasts ending inventory O c. 80% of Stechnos income less 80% of the unrealized profit in Phasts ending inventory O d. 80% of Stechnos income plus 80% of the unrealized profit in Phasts ending inventory

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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