Heartfelt Company Owns a 40% Interest in the Voting Common

question 115

Multiple Choice

Heartfelt Company owns a 40% interest in the voting common stock of Candle Corporation, and Heartfelt accounts for the investment using the equity method. During 2016, Candle Corporation reported net income of $100,000 and declared and paid cash dividends of $10,000. The carrying value of the Candle investment was $500,000 on January 1, 2016. How much investment income should Heartfelt report during 2016 from the Candle investment?

• A)$36,000.
• B)$40,000.
• C)$4,000.
• D)$10,000.

---

Definitions:

Exposure

is the state of being exposed to something, which can refer to elements such as light, ideas, diseases, or chemicals, affecting individuals or groups differently based on duration and intensity.

Gender

Socially constructed roles, behaviors, activities, and attributes that a given society considers appropriate for men and women.

Patterns of Touch

Standard ways in which individuals use physical touch to communicate emotions, intentions, or cultural meanings.

Emotional Support

Assistance provided through empathy, concern, and understanding to help someone cope with their emotions and problems.