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Q3. During January 2019, Mindy, Inc. acquired 30% of the outstanding common stock of Milton Co....

Q3. During January 2019, Mindy, Inc. acquired 30% of the outstanding common stock of Milton Co. for $1,500,000. This investment gave Mindy the ability to exercise significant influence over Milton. Milton’s assets on that date were recorded at $6,400,000 with liabilities of $3,000,000. Any excess of cost over book value of Mindy’ investment was attributed to unrecorded patents having a remaining useful life of ten years. In 2019, Milton reported net income of $600,000. For 2020, Milton reported net income of $750,000. Dividends of $200,000 were paid in each of these two years.

What was the reported balance of Mindy’ Investment in milton Co. at December 31, 2020 and how much was the reported investment income in milton for 2020?

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Q3. During January 2019, Mindy, Inc. acquired 30% of the outstanding common stock of Milton Co. for $1,500,000

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