Heartfelt Company Owns a 40% Interest in the Voting Common

question 46

Multiple Choice

Heartfelt Company owns a 40% interest in the voting common stock of Candle Corporation, accounted for using the equity method. During 2014, Candle Corporation reported net earnings 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, 2014. How much income should Heartfelt report during 2014 from the Candle investment?

• A) $4,000.
• B) $40,000.
• C) $200,000.
• D) $10,000.

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Definitions:

Free Speech

The right to express any opinions without censorship or restraint, fundamental in democracies but also pertinent to workplace rights and union activities.

Election Provisions

The rules and procedures governing how elections are conducted within a labor union context, including the election of representatives or decisions on union status.

Union Democracy

A concept that pertains to the governance of labor unions in a democratic manner, ensuring the participation and representation of all members.

Ethical Theory

An area of philosophy that involves systematizing, defending, and recommending concepts of right and wrong behavior.