Use the following information to answer the question(s)below.
On January 1,2011,Pansy Company acquired a 10% interest in Sunflower Corporation for $80,000 when Sunflower's stockholders' equity consisted of $400,000 capital stock and $100,000 retained earnings.Book values of Sunflower's net assets equaled their fair values on this date.Sunflower's net income and dividends for 2011 through 2013 were as follows:

-Assume that Pansy has significant influence and uses the equity method of accounting for its investment in Sunflower.The balance in the Investment in Sunflower account at December 31,2013 was

Question

Use the following information to answer the question(s)below.
On January 1,2011,Pansy Company acquired a 10% interest in Sunflower Corporation for $80,000 when Sunflower's stockholders' equity consisted of $400,000 capital stock and $100,000 retained earnings.Book values of Sunflower's net assets equaled their fair values on this date.Sunflower's net income and dividends for 2011 through 2013 were as follows:
 
-Assume that Pansy has significant influence and uses the equity method of accounting for its investment in Sunflower.The balance in the Investment in Sunflower account at December 31,2013 was

Quizplus · Accepted Answer

C)
Initial Investment in Sunflower $80,000
adjustments:
2011: 10% × ($8,000-$5,000)= 300
2012: 10% × ($10,000-$5,000)= 500
2013: 10% × ($15,000-$5,000)= 1,000
Investment balance at 12/31/2013: $81,800

Use the Following Information to Answer the Question(s)below