Calculate the book value of kangaroo equity investment

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Question - At the beginning of the year, the Kangaroo Brewery of Melbourne, Australia purchased a 25 percent ownership interest in Kuala Barof Brisbane, Australia. The investment cost $12 million. At year- end, Kuala Bardeclared and paid cash dividends to shareholders totaling $320,000, after reporting earnings of $2.0 million.

Required -

A. Calculate the income statement effect of Kangaroo's investment in Kuala Baras of year-end.

B. Calculate the book value of Kangaroo's equity investment in Kuala Bar at year-end.

C. Calculate the book value of Kangaroo's equity investment in Kuala Bar at year-end assuming that Down Under reported a loss of $1.2 million instead of a profit of $2.0 million and still paid its dividend of $320,000.

Reference no: EM133179326

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