Republic Corp

question 95

Multiple Choice

Republic Corp. owns a 15% interest in the common shares of Wholesome Ltd. During this year, Wholesome pays a total of $25,000 in dividends and reports $160,000 net income. Republic's investment in Wholesome will increase Republic's net income by

• A) $25,000.
• B) $24,000.
• C) $27,750.
• D) $ 3,750.

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Definitions:

Credit Balance

A situation in an account where the amount of credits exceeds the amount of debits, indicating that money is owed to the account holder.

Common Stock

Equity securities that represent ownership in a corporation, with voting rights and potential for dividends.

Consolidated Equipment

Assets that are combined from different departments or subsidiaries within a company for reporting purposes, often in the context of financial statements.

Fair Values

A financial term indicating the estimated market value of an asset or liability, based on current prices in an active market.