Refer to the following selected financial information from shakley's incorporated. compute the company's profit margin for year 2. year 2 year 1 net sales $ 484,000 $ 427,350 cost of goods sold 277,400 251,220 interest expense 10,800 11,800 net income before tax 68,350 53,780 net income after tax 47,150 41,000 total assets 319,300 294,600 total liabilities 175,900 168,400 total equity 143,400 126,200

On january 2, well co. purchased 10% of rea, inc.’s outstanding common shares for $400,000, which equaled the carrying amount and the fair value of the interest purchased in rea’s net assets. well did not elect the fair value option. because well is the largest single shareholder in rea, and well’s officers are a majority on rea’s board of directors, well exercises significant influence over rea. rea reported net income of $500,000 for the year and paid dividends of $150,000. in its december 31 balance sheet, what amount should well report as investment in rea?