Use the Following Information to Answer the Question(s) Below

question 5

Multiple Choice

Use the following information to answer the question(s) below.
Bird Corporation purchased an 80% interest in Brush Corporation on July 1, 2010 at its book value, and on January 1, 2011 its Investment in Brush account was $300,000, equal to its book value. Brush's net income for 2011 was $99,000 (earned uniformly) ; no dividends were declared. On March 1, 2011, Bird reduced its interest in Brush by selling a 20% interest, one-fourth of its investment, for $84,000.
-If Bird uses the "actual-sale-date" sales assumption, its gain on the sale and income from Brush for 2011 will be

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Definitions:

Cost of Equity

The return a company needs to generate to compensate its equity investors, often calculated using models like the Capital Asset Pricing Model (CAPM).

Financing

The process of providing or obtaining funds for business activities, making purchases, or investing.

Initial Cost

The original expenditure for purchasing an asset or starting a project, excluding maintenance or operating costs.

Project Analysis

The examination of the various aspects of a project, including costs, revenue, risks, and benefits, to assess its viability and potential for success.