On January 1, 2011, Deuce Inc

question 100

Multiple Choice

On January 1, 2011, Deuce Inc. acquired 15% of Wiz Co.'s outstanding common stock for $62,400 and categorized the investment as an available-for-sale security. Wiz earned net income of $96,000 in 2011 and paid dividends of $36,000. On January 1, 2012, Deuce bought an additional 10% of Wiz for $54,000. This second purchase gave Deuce the ability to significantly influence the decision making of Wiz. During 2012, Wiz earned $120,000 and paid $48,000 in dividends. As of December 31, 2012, Wiz reported a net book value of $468,000. For both purchases, Deuce concluded that Wiz Co.'s book values approximated fair values and attributed any excess cost to goodwill.
-On Deuce's December 31, 2012 balance sheet, what balance was reported for the Investment in Wiz Co. account?

• A) $139,560.
• B) $143,400.
• C) $310,130.
• D) $186,080.
• E) $182,250.

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