On January 1,2014,Kimba Co.paid $500,000 for 20,000 shares of Flathead Co.'s common stock and classified these shares as trading securities.Kimba does not have the ability to exercise significant influence over Flathead.Flathead declared and paid a dividend of $.50 a share to its stockholders during 2014.Flathead reported net income of $260,000 for the year ended December 31,2014.The fair value of Flathead Co.'s stock at December 31,2014,is $27 per share.What is the net asset amount (which includes both investments and any related market adjustments) attributable to the investment in Flathead that will be included on Kimba's balance sheet at December 31,2014?
A) $530,000
B) $540,000
C) $569,000
D) $579,000
Correct Answer:
Verified
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