On January 1, 2018, Beilich Enterprises bought 20% of the
outstanding common stock of Wolfe Construction Company for $620.0
million cash. Wolfe’s net income for the year ended December 31,
2018, was $310.0 million. During 2018, Wolfe declared and paid cash
dividends of $62.0 million. Beilich recorded the investment as
follows:
($ in millions) | ||
Purchase | ||
Investment in Wolfe Construction shares | 620.0 | |
Cash | 620.0 | |
Net income | ||
Investment in Wolfe Construction shares (20% × $310.0 million) | 62.0 | |
Investment revenue | 62.0 | |
Dividends | ||
Cash (20% × $62.0 million) | 12.4 | |
Investment in Wolfe Construction shares. | 12.4 | |
Required:
What would be the pretax amounts related to the investment that
Beilich would report in its statement of cash flows for the year
ended December 31, 2018? (Enter your answers in millions
rounded to 1 decimal place (i.e., 5,500,000 should be entered as
5.5). Cash outflows should be indicated by a minus
sign.)
Operating activities
Investing activities
Financing activities
Thank you
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5
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