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How much should the baker company report on balance sheet

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Question - On January 1, 2015, Baker Company purchased 10,000 shares of the stock of Murphy, and did obtain significant influence. The investment is intended as a long-term investment. The stock was purchased for $70,000, and represents a 25% ownership stake. Murphy made $20,000 of net income in 2015, and paid dividends of $10,000. The price of Murphy's stock increased from $20 per share at the beginning of the year, to $22 per share at the end of the year.

Requirements:

Prepare the January 1 and December 31 general journal entries for Baker Company.

How much should the Baker Company report on the balance sheet for the investment in Murphy at the end of 2015?

Reference no: EM132117317

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