Ziegler Corporation purchased 25,000 shares of common stock of the Sherman Corporation for $40 per share on January 2, 2010. Sherman Corporation had 100,000 shares of common stock outstanding during 20 I3, paid cash dividends of $120.000 during

20 I3, and reported net income of $400,000 for 20 I3. Ziegler Corporation should report revenue from investment for 20 I3 in the
amount of
a. $30,000.
b. $100,000.
c. $70,000.
d. $110,000.

B 100000

To determine the revenue from investment for 2013, we need to calculate the dividend income received from the Sherman Corporation and any income generated from the increase in the value of the investment.

First, let's calculate the dividend income:
The Sherman Corporation paid cash dividends of $120,000 during 2013. Since Ziegler Corporation owns 25,000 shares of common stock, the dividend income per share is $120,000 / 100,000 shares = $1.20 per share.
Therefore, the dividend income for Ziegler Corporation is $1.20 * 25,000 shares = $30,000.

Now, let's calculate the income generated from the increase in the value of the investment:
To calculate the income generated from the increase in the value of the investment, we need to determine if any unrealized gains or losses exist. The problem statement does not provide this information, so we assume that there are no unrealized gains or losses.

Therefore, the revenue from investment for 2013 is the total of the dividend income and any income generated from the increase in the value of the investment. In this case, the revenue from investment for 2013 is $30,000 (dividend income).
So, the correct answer is (a) $30,000.