JDR Company Purchased 40% of the Common Stock of YRK

Multiple Choice

JDR Company purchased 40% of the common stock of YRK Corporation on January 1, 20X0, for $2,000,000 as a long-term investment. The records of YRK Corporation showed the following on December 31, 20X0: $$\begin{array} { | l | r | } \hline 20 X 0 \text { net income } & \$ 290,000 \\\hline \text { Dividends declared and paid during December, 20X0 } & \$ 20,000 \\\hline\end{array}$$ How much investment income should JDR report from the YRK investment during 20X0?

A) $290,000
B) $30,000
C) $116,000
D) $12,000