GNR Inc. owns 100% of NMX Inc. During the year, NMX Inc. earned a net income of $40,000 and paid Dividends of $10,000. Assuming that GNR owned 80% of NMX instead of 100%, what would be the effect on GNR's investment in NMX account under the Cost Method?
A) An increase of $24,000.
B) An increase of $30,000.
C) An increase of $40,000.
D) No effect.
Correct Answer:
Verified
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