Pendleton Company Acquired a 70% Interest in Sunflower Company on December

question 6

Multiple Choice

Pendleton Company acquired a 70% interest in Sunflower Company on December 31, 2016, for $380,000. During 2017 Sunflower had a net income of $30,000 and paid a cash dividend of $10,000. Applying the cost method would give a debit balance in the Investment in Stock of Sunflower Company account at the end of 2017 of:

• A) $400,000.
• B) $394,000.
• C) $373,000.
• D) $380,000.

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Definitions:

Introspection

The analysis or scrutiny of one’s personal mental and emotional activities.

Empirical Approach

A method of investigation that relies on direct observation and experimentation to gather evidence.

Critical Thinking

The objective analysis and evaluation of an issue in order to form a judgement.

Neuroscience Perspective

An approach to understanding behavior and mental processes through the study of the brain, nervous system, and other biological aspects.