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On 1/1/11, Vitale Co. invested $1,000,000 in Demo Co. for 25% of its outstanding stock....

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Accounting

On 1/1/11, Vitale Co. invested $1,000,000 in Demo Co. for 25% of its outstanding stock. The equity method of accounting is appropriate. Demo Co. pays out 40% of net income in dividends each year. Vitale received $50,000 in Demo dividends during 2011. What is Vitale's 12/31/11 balance of the Investment in Demo account? Select one: a. $1,500,000 b. $1,150,000 c. $1,075,000 d. $1,200,000 e. $1,030,000 Feedback

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