On january 2, matthews corporation acquired 20% of the outstanding common stock of dernier company for $700,000. for the year ended december 31, dernier reported net income of $180,000 and paid cash dividends of $60,000 on its common stock. at december 31, the carrying value of matthews' investment in dernier under the equity method is:

a. $688,000.
b. $700,000.
c. $712,000.
d. $724,000.

M. cotteleer electronics supplies microcomputer circuitry to a company that incorporates microprocessors into refrigerators and other home appliances. one of the components has an annual demand of 235 units, and this is constant throughout the year. carrying cost is estimated to be $1.25 per unit per year, and the ordering (setup) cost is $21 per order. a) to minimize cost, how many units should be ordered each time an order is placed? b) how many orders per year are needed with the optimal policy? c) what is the average inventory if costs are minimized? d) suppose that the ordering cost is not $21, and cotteleer has been ordering 125 units each time an order is placed. for this order policy (of q = 125) to be optimal, determine what the ordering cost would have to be.