Olivia Co owns 4,000 of the 10,000 outstanding shares of Hobbitt Corp common stock and exercises significant influence over the company. During 2011, Hobbitt earns $80,000 and pays cash dividends of $30,000 . For the year ended December 31, 2011 Olivia should report income related to the investment equal to
a. $0
b. $12,000
c. $32,000
d. $20,000
C
40%*$80,000= $32,000
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