On January 1, 2020 Our Newco paid $2 million for 50,000 shares of Annie's voting common stock. Annie Company has 100,000 shares outstanding. At the time of purchase Annie's total stockholders' equity was valued at $4,000,000. Question 5 2 pts lf Annie Company reported net income of $500,000 and paid dividends of $10 per share then at the end of 2020 OurNewco would report an Investment in Annie balance of? (use whole dollars with no dollar sign. Hint: write out journal entries and use a t-account to keep track of the investment balance)
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