An Investor Owns 32% of the Outstanding Common Stock of Leshan

question 37

Multiple Choice

An investor owns 32% of the outstanding common stock of Leshan Company.Leshan Company reports net income of $90,000 for the current year.Which journal entry should the investor prepare?

• A)debit Cash for $28,800 and credit Equity-method Investment Revenue for $28,800
• B)debit Cash for $28,800 and credit Equity-method Investment for $28,800
• C)debit Equity-method Investment for $28,800 and credit Equity-method Investment Revenue for $28,800
• D)debit Equity-method Investment Revenue for $28,800 and credit Equity-method Investment for $28,800

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