Lee, Inc. acquired 30% of Polk Corp.'s voting stock on January 1, Year 1,
for $100,000. During Year 1, Polk
earned $40,000 and paid dividends of $25,000. Lee's 30% interest in Polk
gives Lee the ability to exercise
significant influence over Polk's operating and financial policies. During
Year 2, Polk earned $50,000 and
paid dividends of $15,000 on April 1, and $15,000 October 1. On July 1, Year
2, Lee sold half its stock in Polk
for $66,000 cash.
Before income taxes, what amount should Lee include in its Year 1 income
statement as a result of the
investment?
a. $40,000
b. $25,000
c. $12,000
d. $7,500
Explanation
Choice "c" is correct, $12,000 income in Year 1 income statement: $40,000
income x 30% interest = $12,000
Investment
30% equity
interest
Purchase price 1/1/Year 1 $100,000
Add: Year 1 income $40,000 x 30% = 12,000
Less: Year 1 dividends 25,000 x 30% = (7,500)
Balance at 12/31/Year 1 104,500
Add: Year 2 income - 1/2 yr ½ x 50,000 x 30% = 7,500
Less: 4/1/Year 2 dividend 15,000 x 30% = (4,500)
Balance at 6/30/Year 2 107,500
Percentage sold x 50%
Cost of half sold 53,750
Selling price 66,000
Gain on sale $ 12,250
我不明白 year 2 income 为何要/2，dividend按他说的/4也不是7500呀？有人能帮忙
解释一下year 2的情况么？
