E17-13 Parent Co. invested $1,000,000 in Sub Co. for 25% of its outstanding stock. Sub Co. pays out 40% of net income in dividends each year.
Use the information in the following T-account for the investment in Sub to answer the following questions.
Investment in Sub Co.
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(a) How much was Parent Co.’s share of Sub Co.’s net income for the year?
Net income $
(b) How much was Parent Co.’s share of Sub Co.’s dividends for the year?
Dividends $
(c) What was Sub Co.’s total net income for the year?
Total net income $
(d) What was Sub Co.’s total dividends for the year?
Total Dividends $
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