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Equity Method On January 2, 2015, Winstead & Company purchased 1,000,000 shares of the Secrest...

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Finance

Equity Method

On January 2, 2015, Winstead & Company purchased 1,000,000 shares of the Secrest Company for $32 million. The investment represented 40 percent of the outstanding common shares of The Secrest Company. During 2015, Secrest reported net earnings of $1.05 per share and paid a cash dividend of $0.35 per share.

During 2016, Secrest reported net earnings of $1.50 per share and paid a cash dividend of $0.40 per share.

Calculate the book value of Winsteads investment in Secrest as of December 31, 2015, and December 31, 2016.

2015 $Answer

2016 $Answer

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