On May 20 2017 Montero Co Paid 1 000 000 To Acquire 25 000 Common Shares 10 Of Ord C 3951484

On May 20, 2017, Montero Co. paid $1,000,000 to acquire 25,000 common shares (10%) of ORD Corp. as a long-term investment. On August 5, 2018, Montero sold one-half of these shares for $625,000.
1. What valuation method should be used to account for this stock investment?

  • Fair value method
  • Equity method

2. Prepare entries to record both the acquisition and the sale of these shares.

Prof. Angela

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