Question: Gaw Company owns 15% of the common stock of Teal Corporation and used the fair-value method to account for this investment. Teal reported net income of $110,000 for 2002 and paid dividends of $60,000 on October 1, 2002. How much income should Gaw recognize on this investment in 2002?
A) $16,500
B) $ 9,000
C) $25,500
D) $ 7,500
E) $50,000