Culver Co. invested $1,080,000 in Larkspur Co. for 25% of its outstanding stock. Larkspur Co. pays...
Culver Co. invested $1,080,000 in Larkspur Co. for 25% of its outstanding stock. Larkspur Co. pays out 40% of net income in dividends each year. Use the information in the following T-account for the investment in Larkspur to answer the following questions.
Investment in Larkspur Co
Dr. Cr.
| 1,080,000 | |
| 116,000 | |
| 46,400 |
(a) How much was Culver Co.’s share of Larkspur Co.’s net income for the year?
(b) What was Larkspur Co.’s total net income for the year?
(c) What was Larkspur Co.’s total dividends for the year?
(d) How much was Culver Co.’s share of Larkspur Co.’s dividends for the year?
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Culver Co. invested $1,080,000 in Larkspur Co. for 25% of its
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(a) How much was Monty Co.’s share of Flounder
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On January 1, 2020, Culver Corporation purchased 20% of the
common shares of Larkspur Company for $159,000. During the year,
Larkspur earned net income of $86,000 and paid dividends of
$21,500. Prepare the entries for Culver to record the purchase and
any additional entries related to this investment in Larkspur
Company in 2020. (Credit account titles are automatically indented
when amount is entered. Do not indent manually. If no entry is
required, select "No Entry" for the account titles and...
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