Plate Corporation acquired 75 percent of the stock of Silver Company on January 1, 20X7, for $225,000. At that date, the fair value of the noncontrolling interest was $75,000. Silver's balance sheet contained the following amounts at the time of the combination: Cash$40,000 Accounts Payable$50,000 Accounts Receivable 40,000 Bonds Payable 50,000 Inventory 20,000 Common Stock 100,000 Buildings and Equipment (net) 300,000 Retained Earnings 200,000 Total Assets$400,000 $400,000 During each of the next three years, Silver reported net income of $30,000 and paid dividends of $10,000. On January 1, 20X9, Plate sold 1,500 shares of Silver's $10 par value shares for $60,000 in cash. Plate used the fully adjusted equity method in accounting for its ownership of
Silver Company.Based on the preceding information, what was the balance in the investment account reported by Plate on January 1, 20X9, before its sale of shares?
A. $225,000
B. $245,000
C. $255,000
D. $285,000
Answer: C
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