On October 1,20X7,Chicago Corporation Purchased 6,000 Shares of Buffalo Company's

question 29

Multiple Choice

On October 1,20X7,Chicago Corporation purchased 6,000 shares of Buffalo Company's 15,000 outstanding share of common stock for $25 per share.On December 15,20X7,Buffalo paid $120,000 in dividends to its common stockholders.Buffalo's net income for the year ended December 31,20X7 was $300,000,earned evenly throughout the year.In its 20X7 income statement,what amount of income from this investment should Chicago report?

• A) $12,000
• B) $30,000
• C) $48,000
• D) $120,000

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