The market value of the investment in Central Perk – Get an Orginal Paper (homeworkcorp.com/order)

 

 

 

On January 1, 2019, Gunther Corporation purchases a 20% interest in the Central Perk Coffee Corporation for $1,250,000. Both companies have a December 31 year-end. On January 1, 2019, Central Perk owned some equipment whose book value was $10,000 less than its fair value. The equipment had a remaining useful life of 5 years. At the end of 2019, Central Perk reports a net income of $250,000. Also on December 31, 2019, the market value of the investment in Central Perk shares is $1,270,000. On February 14, 2020, Central Perk pays a cash dividend. Gunther’s ownership entitles it to $95,000 of the dividend.
Record the purchase of the shares:

 

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