During the prior year, SDIC purchased 10% of the common shares of Twin Cones (TC), a producer of dipped ice cream cones, for $200,000. The shares of TC are not publicly traded, and the purchase price was established as five times net income of $40,000. The past fiscal year has proved to be a challenge for TC due to increased competition, commodity price inflation, and an inability to raise prices due to limits on consumer discretionary spending. TC’s most recent financial statements report reveals net income of $27,500.