On July 1, 20X4, Low Corp. obtained significant influence over Slap Co. through the purchase of
2,000 shares of Slap's 10,000 outstanding shares of common stock for $20 per share. This is Low's only ownership of Slap.
- On December 15, 20X4, Slap paid $40,000 in dividends to its common stockholders (in total).
- Slap's net income for the year ended December 31, 20X4, was $120,000, earned evenly throughout the year.
1. What amount of income from this investment should Low report for 20X4?
2. What is the balance in the investment account on the balance sheet at 12/31/20X4?