An investor company owns 30% of the common stock of an investee
company. The investor has significant influence over the investee,
and acquired its equity interest in the investee on January 1, 2018
for $525,000. On the date of acquisition, the investee’s
stockholders equity was $1,500,000, and the fair values of the
investee’s individual net assets were equal to their reported book
values. During the year ended December 31, 2018, the investee
reported net income of $50,000 and dividends of...