Journal entry to record income from investee with loss from discontinued operations
Man Corporation purchased a 40 percent interest in Nib Corporation for $1,000,000 on January 1, at book value, when Nibs’s assets and liabilities were recorded at their fair values. During the year, Nib reported net income of $600,000 as follows (in thousands):
|
Income from continuing operations |
$700 |
|
Less: Loss from discontinued operations |
100 |
|
Net income |
$600 |
REQUIRED : Prepare the journal entry on Man’s books to recognize income from the investment in Nib for the year.