Zimt AG is a consumer products manufacturer headquartered in Austria. It complies with IFRS.

In 2008, Zimt held a 10 percent passive stake in Oxbow Limited that was classified as held-for-trading securities. During the year, the value of this stake declined by 3 million.

In December 2008, Zimt announced that it would be increasing its ownership to 50 percent effective 1 January 2009.

Franz Gelblum, an analyst following both Zimt and Oxbow, is curious how the increased stake will affect Zimt’s consolidated financial statements. Because Gelblum is uncertain how the company will account for the increased stake, he uses his existing forecasts for both companies’ financial statements to compare various alternative outcomes.

Gelblum gathers abbreviated financial statement data for Zimt (Exhibit 15-9) and Oxbow (Exhibit 15-10) for this purpose.

EXHIBIT 15-9 Selected Financial Statement Estimates for Zimt AG ( millions)

Year ending 31 December

2008

2009

Revenue

1,500

1,700

operating income

135

153

Net income

66

75

Total assets

1,254

1,421

Shareholders” equity

660

735

EXHIBIT 15-10 Selected Financial Statement Estimates for Oxbow Limited ( millions)

Year ending 31 December

2008

2009

Revenue

1,200

1,350

operating income

120

135

Net income

60

68

Dividend paid

20

22

Total assets

1,200

1,283

Shareholders” equity

660

706

Based on Gelblum’s estimates, if Zimt is deemed to have significant influence over Oxbow, its 2009 operating income would be closest to

a. 153.

b. 221.

c. 288.