Use the Following Information for Questions 97 and 98

question 18

Multiple Choice

Use the following information for questions 97 and 98.
Harrison Company owns 20,000 of the 50,000 outstanding shares of Taylor, Inc. common stock. During 2015, Taylor earns $1,000,000 and pays cash dividends of $800,000.
-Harrison should report investment revenue for 2015 of

• A) $400,000.
• B) $320,000.
• C) $80,000.
• D) $0.

---

Definitions:

Administrative Expenses

Costs associated with the general operation of a company, which do not directly relate to the production or selling of goods or services.

Budgeting

The process of creating a plan to spend your money, outlining projected income versus expenses.

Activity Variance

The difference between the planned activity and actual activity levels, often used in budgeting and forecasting.

Servicing Materials

Items and supplies used in the maintenance and repair of machinery, equipment, or products to ensure their continued operation or use.