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Alex, Inc., buys 30 percent of Steinbart Company on January 1, 2017, for $1,134,000. The equity...

Alex, Inc., buys 30 percent of Steinbart Company on January 1, 2017, for $1,134,000. The equity method of accounting is to be used. Steinbart’s net assets on that date were $3.50 million. Any excess of cost over book value is attributable to a trade name with a 20-year remaining life. Steinbart immediately begins supplying inventory to Alex as follows: Year Cost to Steinbart Transfer Price Amount Held by Alex at Year-End (at Transfer Price) 2017 $141,440 $208,000 $52,000 2018 117,120 192,000 59,000 Inventory held at the end of one year by Alex is sold at the beginning of the next. Steinbart reports net income of $91,250 in 2017 and $125,850 in 2018 and declares $30,000 in dividends each year. What is the equity income in Steinbart to be reported by Alex in 2018?

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