On January 1, 20X4, Entertainment Company Acquired 15% of the Outstanding

Multiple Choice

On January 1, 20X4, Entertainment Company acquired 15% of the outstanding voting stock of Rocker Company as a long-term investment and classified the shares as available-for-sale securities. During 20X4, Rocker Company reported net income of $1,500,000 and dividends declared and paid of $250,000. How much income will be reported during 20X4 from the Rocker investment?

A) $225,000
B) $37,500
C) $187,500
D) $250,000