On January 2,20X5,Park Co

Multiple Choice

On January 2,20X5,Park Co.purchased 10 percent of Sky,Inc.'s outstanding common shares for $400,000.Park is the largest single shareholder in Sky,and Park's officers are a majority on Sky's board of directors.As a result,Park is able to exercise significant influence over Sky.Sky reported net income of $500,000 for 20X5,and paid dividends of $150,000.In its December 31,20X5,balance sheet,what amount should Park report as investment in Sky?

A) $385,000
B) $450,000
C) $400,000
D) $435,000