Calculate the income statement effect of sean investment

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Question - At the beginning of the year, the Sean Brewery purchased a 25 percent ownership interest in Mark Pub. The investment cost $12 million. At year-end, Mark Pub declared and paid cash dividends to shareholders totaling $320,000, after reporting earnings of $2.0 million.

Required -

A. Calculate the income statement effect of Sean's investment in Mark Pub as of year-end.

B. Calculate the book value of Sean's equity investment in Mark Pub at year-end.

C. Calculate the book value of Sean's equity investment in Mark Pub at year-end assuming that Sean Brewery 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: EM132803784

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