Heartfelt Company Owns a 40% Interest in the Voting Common

question 76

Multiple Choice

Heartfelt Company owns a 40% interest in the voting common stock of Candle Corporation, accounted for using the equity method. During 20X4, 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, 20X4.
-How much income should Heartfelt report during 20X4 from the Candle investment?

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

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Definitions:

Paradoxical Intent

A therapeutic technique in which a person tries to bring about a feared outcome, often resulting in the reduction of the fear’s intensity.

Behavior Therapies

A type of psychotherapy that focuses on changing undesirable behaviors through reinforcement and conditioning.

Humanistic

A psychological perspective emphasizing the study of the whole person and individual potential and growth.

Is Learned

Refers to behaviors, skills, or information acquired through experience, observation, or instruction, rather than innate.