On January 1 2010 Palmer Inc. bought 40% of the outstandingshares of Arnold Corp

On January 1 2010 Palmer Inc. bought 40% of the outstandingshares of Arnold Corporation at a cost of $137000. The equitymethod of accounting for this investment is used. During 2010Arnold Corporation reported $30000 of net income and paid $10000in cash dividends. At the end of 2010 the shares had a marketvalue of $150000. How much income will Palmer report from theArnold investment during 2010?A) $12000B) $30000C) $10000D) $4000