InvestCo purchases 30% of NewCo's stock on January 1, Year 1, for $100,000 . In Year 1, NewCo paid total dividends of $30,000 and had a net income of $70,000 . In Year 2, NewCo suffered a loss of $20,000 and paid no dividends. On January 1, Year 3, InvestCo sells its investment in NewCo for $105,000 . How is the sale recorded?
a. Cash 105,000
Loss on Sale 1,000
Investment in NewCo 106,000
b. Cash 105,000
Loss on Sale 4,000
Investment in NewCo 109,000
c. Cash 105,000
Loss on Sale 10,000
Investment in NewCo 115,000
d. Cash 105,000
Gain on Sale 14,000
Investment in NewCo 91,000
e. Cash 105,000
Treasury Stock 14,000
Investment in NewCo 91,000
A
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