REFERENCE: Ref.01_15 Cayman Inc.bought 30% of Maya Company on January 1,2008 for 1,2008

REFERENCE: Ref.01_15
Cayman Inc.bought 30% of Maya Company on January 1,2008 for $450,000.The equity method of accounting was used.The book value and fair value of the net assets of Maya on that date were $1,500,000.Maya began supplying inventory to Cayman as follows:
Maya reported net income of $100,000 in 2008 and $120,000 in 2009 while paying $40,000 in dividends each year.
-Which of the following results in an increase in the Equity in Investee Income account when applying the equity method?

A) Amortizations of purchase price over book value on date of purchase.
B) Amortizations of purchase price over book value on date of purchase for the prior year.
C) Extraordinary gain of the investor.
D) Unrealized gain on intercompany inventory transfers for the prior year.
E) Sale of a portion of the investment at a loss.