XYZ Buys a 24 Per Cent Share in ABC for $80m.ABC's

question 18

Multiple Choice

XYZ buys a 24 per cent share in ABC for $80m.ABC's total net profit is $50m and it pays $4m in dividends to XYZ.
-Using the equity method,the value of the investment in ABC would be recorded at year-end as:

• A) $80m.
• B) $88m.
• C) $92m.
• D) $19m.

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