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Financial Accounting

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Value of Investment under the Equity Method

FINACT-UO6ZJ4

Your company purchased 35% of your supplier's outstanding voting shares for \$5,000,000 on October 1, 2015 to get involved in its operations. On December 1, your company received cash dividend of \$200,000. At the end of 2015, your supplier had a net income of \$10,000,000 for 2015.​

(I): What was the value of this investment after the receipt of the cash dividend (in \$ amount)?

(II): What was the value of this investment at the end of 2015 (in \$ amount)?