Compute what amount will poke income increase

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On January 1, 20X7, Poke Corporation acquired 25 percent of the outstanding shares of Shove Corporation for $100,000 cash. Shove Company reported net income of $75,000 and paid dividends of $30,000 for both 20X7 and 20X8. The fair value of shares held by Poke was $110,000 and $105,000 on December 31, 20X7 and 20X8 respectively.

Problem 1: If instead, Poke could not exercise significant influence over the investee, by what amount will Poke's 20X8 income increase due to its investment in Shove?

Reference no: EM132669254

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