An investor uses cash to purchase 33% interest in an investee company, and the investor...
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Accounting
An investor uses cash to purchase 33% interest in an investee company, and the investor concludes that it can exert significant influence over the investee. The book value is equal to the fair value of the investees assets and liabilities on the acquisition date and the investor purchases its interest for $200,000. Subsequent to the acquisition, the investee reports net income of $355,813, and pays cash dividends of $10,000.
How much equity income the investor report for the year?
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