Owners are not required to pay it to foreign works is incorrect option
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The answer is Target-driven<span>
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Answer:
Investment revenue = $52,000
Explanation:
Since Puff uses the equity method, the original journal entry to record the purchase of 40% of the shares should have been:
Dr Investment in Straw 400,000
Cr Cash 400,000
After one year, Straw earned $150,000 in net income, but it also had equipment with a fair market value higher than carrying value also depreciable by $100,000. So the net income must be adjusted = $150,000 - ($100,000 x 20%) = $130,000. The journal entry to record the adjusted income should be ($130,000 x 40%):
Dr Investment in Straw 52,000
Cr Investment revenue 52,000
