Accounts for investment using the equity method

Assignment Help Financial Accounting

Reference no: EM131296080

Arvil Company owns 25% of Zelda Inc. and accounts for the investment using the equity method. During the year, Zelda Inc. reports a net loss of $890,000 and pays total dividends of $41,000.

Which of the following describes the change in Avril’s investment in Zelda during the year?

a. The investment increases by $181,500.

b. The investment decreases by $232,750.

c. The investment decreases by $222,500.

d. The investment decreases by $10,250.

e. None of the above

Reference no: EM131296080

Questions Cloud

Computing the net present value of an annuity factor : The management of South Texas Tourism Co. is considering two capital investment projects. Determine the Internal Rate of Return for each project by computing the Net present Value of an Annuity factor from the Appendix, and using that factor to inter..

About updating his antiquated computer system : An owner of an automobile body shop comes into your office for tax advice. He has been thinking about updating his antiquated computer system so he purchased a consumer handbook then he flew to San Francisco to visit the Apple Store to shop for compu..

Does disney use the direct method or the indirect method : Does Disney use the direct method or the indirect method? Explain. Analyze Disney's overall cash flow picture for 2009, 2010, 2011 in light of the positive or negative cash flow patterns for the three categories of cash flows. In the notes to Disney'..

Employee stock compensation details : eBay’s footnote regarding employee stock compensation details the grant of 2 million options during the year of 2013, the fair-value of which was computed as $15.39. If the options have, on average, a four-year vesting schedule and the company faces ..

Accounts for investment using the equity method : Arvil Company owns 25% of Zelda Inc. and accounts for the investment using the equity method. During the year, Zelda Inc. reports a net loss of $890,000 and pays total dividends of $41,000. Which of the following describes the change in Avril’s inves..

What is the margin-net income and return on equity : Company earned ROI of 8.8%. Sales were $15,000,000 and avg asset turnover 2.2. Avg stockholders equity was $3.2 million. What is the margin %, net income and Return on equity?

Prepare the issuance journal entry : Prepare the issuance journal entry and the first annual payment using straight-line. All bonds were dated January 1, 2015 and pay annually - Prepare the journal entry to issue

Create a plan to implement firms strategy and manage change : Describe strategic planning techniques used to formulate alternative strategies designed to achieve stated business goals. Create a plan to implement a firm's strategy and manage the change from current operations.

Document your journal in chronological order : Keep a human-computer interface (HCI) journal with your weekly observations of HCI issues that pertain to you, your work, your family, and your friends. Be sure to document your journal in chronological order.

User Account

All Pages