Brankov Company purchased common stock in Ramona Company for $400,000.In the current year,Ramona Company reported net income of $50,000 and paid a dividend of $32,000.At the end of the year,the market value of the investment in Ramona Company was $410,000.
Required:
A) Assume Brankov Company owns 10% of the shares of Ramona Company. Brankov Company considers the investment to be available-for-sale securities. Show the effects of the transactions above on the accounts of Brankov Company using the balance sheet equation.
B) Assume Brankov Company owns 25% of the shares of Ramona Company. Show the effects of the transactions above on the accounts of Brankov Company using the balance sheet equation.

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The Answer of Brankov Company purchased common stock in Ramona Company for $400,000.In the current year,Ramona Company reported net income of $50,000 and paid a dividend of $32,000.At the end of the year,the market value of the investment in Ramona Company was $410,000.
Required:
A) Assume Brankov Company owns 10% of the shares of Ramona Company. Brankov Company considers the investment to be available-for-sale securities. Show the effects of the transactions above on the accounts of Brankov Company using the balance sheet equation.
B) Assume Brankov Company owns 25% of the shares of Ramona Company. Show the effects of the transactions above on the accounts of Brankov Company using the balance sheet equation.

Brankov Company Purchased Common Stock in Ramona Company for $400,000