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On January 1, 2010, Mehan, Incorporated purchased 15,000 shares...

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Accounting

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On January 1, 2010, Mehan, Incorporated purchased 15,000 shares of Cook Company for $150,000 giving Mehan a 15% ownership of Cook. On January 1, 2011 Mehan purc Cook for $300,000. This last purchase gave hased an additional 25,000 shares (25%) of Mehan the ability to apply significant influence over Cook. The k value of Cook on January 1, 2010, was $1,000,000. The book value of Cook on January 1,2011, was S1,150,000. Any excess of cost over book value for this second transaction is assigned to a database and amortized over five years. Cook reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout the years 2010 2011 2012 Net Income Dividends $50,000 50,000 60,000 $200,000 225,000 250,000 On April 1, 2012, just after its first dividend receipt, Mehan sells 10,000 shares of its investment. 8. What was the balance in the investment account at December 31, 2011? 9. What was the balance in the investment account at April 1, 2012 just before the sale of shares? 10. How much of Cook's net income did Mehan report for the year 2012? 20% of the 1 00,000 shares of common stock of Thomas nted with the investment

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