Please help with this exercise, greatly thanks if you could do in in details so that...
Please help with this exercise, greatly thanks if you could do in in details so that i can understand how the numbers come from.
The investor Comedy acquires a 30% interest in mother Co. Drama for $800,000
Assume that the investor has the ability to significantly influence the investee
2014: Drama report net losses of $240,000 and issued bonds for $120,000
2015: Drama report net income of $600,000 and pays dividend for $300,000
2016: Drama reports net losses of $120, 000. At the end of the year, Comedy sells one fourth of its investment in Drama for $200,000
Determine of the value of the investment at the end of each year
Homework Answers
Determination of Value of Investment
Total value of Drama = $800000 / 30 % = $ 26,66,667
Value of investment at the end of each year
Year 2014
Value of investment = Value of investment at the beginning of year - Value of bonds issue - Net loss
= $26,66,667 - $120,000 - $240,000
= $ 23,06,667
Value of investment of Comedy in Drama = $23,06,667 * 30% = $692,000
Year 2015
Value of investment = $23,06,667 + $600,000 - $ 300,000
= $ 26,06,667
Value of investment of Comedy in Drama = $26,06,667 * 30% = $692,000 = $ 782,000
Year 2016
Value of investment = $ 26,06,667 - $ 120,000 - $13,500 ( loss on buy back of investment )
= $ 24,73,167
Value of investment of Comedy in Drama = $ 24,73,167 * 30% * 0.75 = $556,462.58
Add Answer to:
Please help with this exercise,
greatly thanks if you could do in in details so that...
my question is how do i calulate the inventorry Problem 1 anuary 1, 2013, Carpenter acquired...
my
question is how do i calulate the inventorry
Problem 1 anuary 1, 2013, Carpenter acquired 40 percent ownership in Cudd for $1,140,000. This acquisition arpenter the ability to exercise significant influence over the investee. The book value of the ured shares was $800,000. Any excess cost over the book value was assigned to a Dunding WING undervalued on its balance sheet. The building has a remaining useful life of 10 years. For the year chued December 31, 2013, Cudd...
Answers given for all. Can you explain each with formulas. 23. On January 1, 2019,...
Answers given for all. Can you explain each with formulas. 23. On January 1, 2019, Windy Meadows Corp. acquired a 10% interest in Jones Enterprises for $20,000. The stock has a readily determinable fair value, so the investor measures the Equity Investment at fair value with all unrealized gains and losses flowing through net income. On December 31, 2019 the fair value of the 10% common stock investment is $24,000. On April 1, 2020, Windy Meadows acquired an additional...
E28. Prepare journal entries for the transactions below relating to an Equity Investment accounted for using...
E28. Prepare journal entries for the transactions below relating to an Equity Investment accounted for using The equity method. a. An investor purchases 14,400 common shares of an investee at $9 per share; the shares represent 25% ownership in the investee and the investor concludes that it can exert significant influence Over the investee. b. The investee reports net income of $96,000. c. The investor receives a cash dividend of $1.50 per common share from the investee. d. The investor...
Anderson acquires 10 percent of the outstanding voting shares of Barringer on January 1, 2013, for...
Anderson acquires 10 percent of the outstanding voting shares of Barringer on January 1, 2013, for $102,520 and categorizes the investment as an available-for-sale security. An additional 20 percent of the stock is purchased on January 1, 2014, for $235,900, which gives Anderson the ability to significantly influence Barringer. Barringer has a book value of $890,000 at January 1, 2013, and records net income of $196,000 for that year. Barringer declared and paid dividends of $79,000 during 2013. The book...
Anderson acquires 10 percent of the outstanding voting shares of Barringer on January 1, 2013, for...
Anderson acquires 10 percent of the outstanding voting shares of Barringer on January 1, 2013, for $102,520 and categorizes the investment as an available-for-sale security. An additional 20 percent of the stock is purchased on January 1, 2014, for $235,900, which gives Anderson the ability to significantly influence Barringer. Barringer has a book value of $890,000 at January 1, 2013, and records net income of $196,000 for that year. Barringer declared and paid dividends of $79,000 during 2013. The book...
22) On January 1, 2014, Benson Corporation paid $800,000 to purchase 40% of the outstanding stock...
22) On January 1, 2014, Benson Corporation paid $800,000 to purchase 40% of the outstanding stock of Kroger Company. Kroger Company reported net income of $200,000 for the year ending December 31, 2014 and paid cash dividends of $60,000 during 2014. On January 1, 2015, Benson Corporation sells its entire investment in Kroger Company for $1,100,000. Benson Corporation will report a(n): A) realized gain on the sale of $300,000. B) unrealized gain on the sale of $300,000. C) realized gain...
22) On January 1, 2014, Benson Corporation paid $800,000 to purchase 40% of the outstanding stock...
22) On January 1, 2014, Benson Corporation paid $800,000 to purchase 40% of the outstanding stock of Kroger Company. Kroger Company reported net income of $200,000 for the year ending December 31, 2014 and paid cash dividends of $60,000 during 2014. On January 1, 2015, Benson Corporation sells its entire investment in Kroger Company for $1,100,000. Benson Corporation will report a(n): A) realized gain on the sale of $300,000. B) unrealized gain on the sale of $300,000. C) realized gain...
On January 1, 2014, Ridge Road Company acquired 25 percent of the voting shares of Sauk...
On January 1, 2014, Ridge Road Company acquired 25 percent of the voting shares of Sauk Trail, Inc. for $4,300,000 in cash. Both companies provide commercial Internet support services but serve markets in different industries. Ridge Road made the investment to gain access to Sauk Trail’s board of directors and thus facilitate future cooperative agreements between the two firms. Ridge Road quickly obtained several seats on Sauk Trail’s board which gave it the ability to significantly influence Sauk Trail’s operating...
need help... please fix the errors as soon as possible. Thanks in advance! Pushdown Accounting Assume...
need help... please fix the errors as soon as possible. Thanks
in advance!
Pushdown Accounting Assume a parent company acquires its subsidiary by paying $1,200,000 for all of the outstanding voting shares of the investee. On the acquisition date, subsidiary's assets and liabilities have individual fair values that equal their book values, except for property equipment with a fair value greater than book value by $150,000 and license with a fair value greater than book value by $250,000. The parent...
On January 1, 2018, Jammin’ Company owns 40 percent (40,000 shares) of Benji, Inc., which it purc...
On January 1, 2018, Jammin’ Company owns 40 percent (40,000 shares) of Benji, Inc., which it purchased several years ago for $364,000. Since the date of acquisition, the equity method has been properly applied, and the carrying amount of the investment account as of January 1, 2018, is $587,200. Excess patent cost amortization of $24,000 is still being recognized each year. During 2018, Benji reports net income of $684,000 and a $240,000 other comprehensive loss, both incurred uniformly throughout the...
my
question is how do i calulate the inventorry
Problem 1 anuary 1, 2013, Carpenter acquired 40 percent ownership in Cudd for $1,140,000. This acquisition arpenter the ability to exercise significant influence over the investee. The book value of the ured shares was $800,000. Any excess cost over the book value was assigned to a Dunding WING undervalued on its balance sheet. The building has a remaining useful life of 10 years. For the year chued December 31, 2013, Cudd...
Anderson acquires 10 percent of the outstanding voting shares of Barringer on January 1, 2013, for $102,520 and categorizes the investment as an available-for-sale security. An additional 20 percent of the stock is purchased on January 1, 2014, for $235,900, which gives Anderson the ability to significantly influence Barringer. Barringer has a book value of $890,000 at January 1, 2013, and records net income of $196,000 for that year. Barringer declared and paid dividends of $79,000 during 2013. The book...
need help... please fix the errors as soon as possible. Thanks
in advance!
Pushdown Accounting Assume a parent company acquires its subsidiary by paying $1,200,000 for all of the outstanding voting shares of the investee. On the acquisition date, subsidiary's assets and liabilities have individual fair values that equal their book values, except for property equipment with a fair value greater than book value by $150,000 and license with a fair value greater than book value by $250,000. The parent...
Most questions answered within 3 hours.
-
On October 1, 20X1, a company purchased a piece of land by
agreeing to pay the...
asked 7 minutes ago -
Jamie is doing a survey at her school about whether the students
feel the cafeteria food...
asked 12 minutes ago -
What are the roles of 3' and 5' untranslated regions in
mRNAs?
asked 13 minutes ago -
A domestic television receives antenna delivers a sky noise
power of -105 dBm to a matched...
asked 12 minutes ago -
What do you think are the chemical reactions involved in the
breathalyzer tests administered to potentially...
asked 27 minutes ago -
A random sample of 120 observations produces a mean of
38.2 from a population with a...
asked 34 minutes ago -
The average area of land burned by forest fires every year in
Canada is 2.5 million...
asked 36 minutes ago -
36. The basic difference between government bureaus and market
firms is that bureaus:
a. can...
asked 36 minutes ago -
java
- A recursive method findR() to search for a number in list
(ArrayList)
- A...
asked 54 minutes ago -
Which of the following is an example of a screen against adverse
selection? [Mark All That...
asked 53 minutes ago -
A worker drives a 0.560 kg spike into a rail tie with a 2.76 kg
sledgehammer....
asked 59 minutes ago -
Assume the following information concerning two stocks that make
up an index. What is the price-weighted...
asked 1 hour ago