Final answer:
The cash received on the investment by Olsen Company was $35,000, calculated as the investment income of $50,000 minus the increase in the investment account of $15,000.
Step-by-step explanation:
Olsen Company's investment income from equity method investments is $50,000, with the related investment account increasing by $15,000. To determine the cash received on the investment, we analyze the relationship between investment income reported and the change in the investment account.
Under the equity method, investment income represents the investor's share of the earnings of the investee. An increase in the investment account beyond the income recognized usually indicates additional contributions or undistributed earnings that were reinvested, rather than received as cash. Therefore, cash received would be the net of the reported investment income minus the increase in the investment account value.
Calculation:
Investment Income: $50,000
Increase in Investment Account: $15,000
Cash Received: $50,000 - $15,000 = $35,000