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Problem 1-9 (LO 1-3, 1-4) Evan Company reports net income of $206.000 each year and declares an annual cash dividend of $110,
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Answer #1
Value of Investment in Evan Company on Jan 01, 2017= $706,000
Add: Share in Net income 206,000*40% for 2017 $82,400
Less: Dividend paid 110,000*40% for 2017 -$44,000
Carrying value of investments as on 31 Dec. 2017 $744,400
Add: Share in Net income 206,000*40% for 2018 $82,400
Less: Dividend paid 110,000*40% for 2018 -$44,000
Carrying value of Investments as on 31 Dec. 2018 $782,800
Add: Share in Net income 206,000*40% for 2019 $82,400
Less: Dividend paid 110,000*40% for 2019 -$44,000
Carrying value of investments as on 31 Dec. 2019 $821,200
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