Heartfelt Company Owns a 40% Interest in the Voting Common

question 52

Multiple Choice

Heartfelt Company owns a 40% interest in the voting common stock of Candle Corporation,and Heartfelt accounts for the investment using the equity method.During 2019,Candle Corporation reported net income of $100,000 and declared and paid cash dividends of $10,000.The carrying value of the Candle investment was $500,000 on January 1,2019.
- At what amount is the Candle investment reported on the December 31,2019 balance sheet of Heartfelt Company?

• A)$496,000.
• B)$500,000.
• C)$536,000.
• D)$540,000.

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