Bloomfield Bakers accounts for its investment in Clor Confectionary under the equity method. Bloomfield carried the Clor investment at $150,000 and $165,000 at December 31, 2017 and 2018, respectively. During 2018 Clor recognized $80,000 of net income and paid dividends of $30,000. Assuming that Bloomfield owned the same percentage of Clor throughout 2018, their percentage ownership must have been:
A) 15%.
B) 18.75%.
C) 30%.
D) 50%.

Question

Quizplus · Accepted Answer

$150,000 + X% ($80,000 - $30,000) = $165,000, × = 30%.

Bloomfield Bakers Accounts for Its Investment in Clor Confectionary Under