StarTech Company Bought 40% of AML Company on January 2

question 53

Multiple Choice

StarTech Company bought 40% of AML Company on January 2, 2014, for their book value of $400,000.During 2014 AML earned net income of $60,000 and paid dividends of $16,000; there were no transactions between the two companies.What amount of investment income would StarTech Company report in 2014 with respect to its investment in AML Company?

• A)$6,400
• B)$16,000
• C)$17,600
• D)$24,000

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Definitions:

Economic Growth

The advance in the actual value, adjusted for price level changes, of goods and services produced in an economy over successive periods.

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The first President of the United States, serving from 1789 to 1797, and is known as one of the Founding Fathers who led the country to victory in the American Revolutionary War.

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The agricultural practices and economy specific to the southern regions, traditionally focused on crops like cotton.

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An intense conflict between factions, regions, or political groups within the same country, often characterized by significant violence and lasting social and economic impact.