Answer:
$201,260
Explanation:
Total number of shares purchased for Sherman corporation is 29,000 at the rate of $44 each
Outstanding number of shares for Sherman corporation is 100,000
Therefore, the amount of investment is calculated by dividing the total number of shares by the outstanding number of shares
= 29,000/100,000
=0.29 × 100
= 29%
Amount of dividend in Sherman corporation is $154,000
Net income of Sherman corporation is $540,000
The total revenue generated by Pharoah corporation is
= 29/100 × ($154,000+$540,000)
= 0.29 × 694000
= $201,260
Thus,Pharaoh Corporation should report revenue from investment for 2021 in the amount of $201,260
Answer:
Pharoah Corporation should report revenue from investment for 2021 in the amount of $156,600
Explanation:
In order to calculate the amount Pharoah Corporation should report revenue from investment for 2021 we would have to use the following formula:
Pharoah Corporation's revenue from investment =reported net income*Pharoah Corporation's share in Sherman
Pharoah Corporation's share in Sherman = 29,000 / 100,000 = 29%
Therefore, Pharoah Corporation's revenue from investment =$540,000 * 29%
Pharoah Corporation's revenue from investment = $156,600
Pharoah Corporation should report revenue from investment for 2021 in the amount of $156,600
