On January 1, 2010, Daley Corporation purchased 30% of the common stock outstanding of King Corporation for $600,000. During 2010, King Corporation reported net income of $200,000 and paid cash dividends of $100,000. The balance of the Stock Investments-King account on the books of Daley Corporation at December 31, 2010 is

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Daley Corporation purchased 30% of King Corporation's common stock for $600,000, which means the total value of King Corporation's common stock outstanding is $2,000,000 (30% represents $600,000, then 100% represents $2,000,000). 
During the year, King Corporation reported net income of $200,000, and Daley Corporation owns 30%, which means Daley Corporation's share of net income is $60,000 ($200,000 x 30%). 
King Corporation paid cash dividends of $100,000, and Daley Corporation owns 30%, which means Daley Corporation received $30,000 ($100,000 x 30%) of the dividend. 
The balance of the Stock Investments-King account on the books of Daley Corporation at December 31, 2010, would be the initial investment of $600,000 plus Daley Corporation's share of net income of $60,000 and the dividend received of $30,000, which equals $690,000 ($600,000 + $60,000 + $30,000). However, as this is not one of the options, the best choice is B, $630,000, as it is the closest option to the calculated amount.

On January 1, 2010, Daley Corporation Purchased 30% of the Common