on april 1,2018, big ben company acquired 30% of the shares of Little Tick, Inc. Big...
on april 1,2018, big ben company acquired 30% of the shares of Little Tick, Inc. Big Ben paid $100,000 for the investment, which is $40,000 more than 30% of the book value of Little Tick's identifiable net assets. Big Ben attributed $15,000 of 40,000 difference to inventory that will be sold in the remainder of 2018, and the rest to goodwill. Little Tick recognized a total of $20,000 of net income for 2018, and paid total dividends for year $10,000, These dividends were issued quarterly. Big Ben's investment in Little Tick will affect Big Ben's 2018 net income
Homework Answers
Big Ben attributed $15,000 to inventory from the difference of $40,000. It will receive its share 30% of net income for 2018 from Little Tick which is for the 9 months period.
Affect on Net income = Net income of Little tick * Share of Big
Ben * (9/12) - Amount attributed to inventory
= $20,000 * 30% * 9/12 - $15,000
= $4,500 - $15,000
= $ -10,500 i.e. loss
Add Answer to:
on april 1,2018, big ben company acquired 30% of the shares of
Little Tick, Inc. Big...
On July 1, 2018, Tremen Corporation acquired 30% of the shares of Delany Company. Tremen paid...
On July 1, 2018, Tremen Corporation acquired 30% of the shares of Delany Company. Tremen paid $3,200,000 for the investment, and that amount is exactly equal to 30% of the book value of identifiable net assets on Delany's balance sheet. Delany recognized net income of $1,500,000 for 2018, and paid $190,000 of dividends each quarter to its shareholders. After all closing entries are made, Tremen's "Investment in Delany Company" account would have a balance of: Multiple Choice Top of Form...
Big owns 30% of the outstanding voting common stock of Little and has the ability to...
Big owns 30% of the outstanding voting common stock of Little and has the ability to significantly influence the investee's operations and decision making. On January 1, 20X1, the balance in the Investment in Little Co. account was $402,000. There is no amortization associated with the purchase of this investment. During 20X1, Little earned income of $108,000 and paid cash dividends of $36,000. Previously in 20X0, Little had sold inventory costing $28,800 to Big for $48,000. All but 25% of...
On January 1, 2017, Ridge Road Company acquired 30 percent of the voting shares of Sauk...
On January 1, 2017, Ridge Road Company acquired 30 percent of the voting shares of Sauk Trail, Inc., for $4,400,000 in cash. Both companies provide commercial Internet support services but serve markets in different industries. Ridae 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...
On July 1, 2018, Tremen Corporation acquired 40% of the shares of Delany Company. Tremen paid...
On July 1, 2018, Tremen Corporation acquired 40% of the shares of Delany Company. Tremen paid $3,170,000 for the investment, and that amount is exactly equal to 40% of the book value of identifiable net assets on Delany's balance sheet. Delany recognized net income of $1,200,000 for 2018, and paid $180,000 of dividends each quarter to its shareholders. After all closing entries are made, Tremen's Investment in Delany Company account would have a balance of:
On January 1, 2016, Halstead, Inc., purchased 79,000 shares of Sedgwick Company common stock for $1,452,000,...
On January 1, 2016, Halstead, Inc., purchased 79,000 shares of Sedgwick Company common stock for $1,452,000, giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period. 2016 2017 2018 Net Income $386,000 496,000 600,000 Annual...
On January 1, 2016, Halstead, Inc., purchased 79,000 shares of Sedgwick Company common stock for $1,402.000.giving...
On January 1, 2016, Halstead, Inc., purchased 79,000 shares of Sedgwick Company common stock for $1,402.000.giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period. 2016 2017 2018 Net Income $400,000 425,000 594,000 Annual Cash...
On 1/1/22 Big Co acquired 100% of Little Co voting stock for $500,000. On that date...
On 1/1/22 Big Co acquired 100% of Little Co voting stock for $500,000. On that date Little's book value was $350,000. Little had the following misvalued assets and liabilities at 1/1/22: Land, undervalued by $20,000 Inventory, FIFO basis, undervalued by $10,000 PPE, 5 year remaining life, undervalued by $80,000. Bonds payable, 10 year life, undervalued by $20,000 During 2022 Little reported earnings of $80,000 and paid dividends of $10,000 1. How much goodwill was inherent in the purchase of Little?...
On 1/1/22 Big Co acquired 100% of Little Co voting stock for $500,000. On that date...
On 1/1/22 Big Co acquired 100% of Little Co voting stock for $500,000. On that date Little's book value was $350,000. Little had the following misvalued assets and liabilities at 1/1/22: Land, undervalued by $20,000 Inventory, FIFO basis, undervalued by $10,000 PPE, 5 year remaining life, undervalued by $80,000. Bonds payable, 10 year life, undervalued by $20,000 During 2022 Little reported earnings of $80,000 and paid dividends of $10,000. 1.How much goodwill was inherent in the purchase of Little? 2.Assuming...
On January 1, 2016, Halstead, Inc., purchased 84,000 shares of Sedgwick Company common stock for $1,499,000,...
On January 1, 2016, Halstead, Inc., purchased 84,000 shares of Sedgwick Company common stock for $1,499,000, giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period. Annual Cash Dividends (pai quarterly) $122,ee8 128,000 167,000 Net...
3 On January 1, 2016, Halstead, Inc., purchased 69,000 shares of Sedgwick Company common stock for...
3 On January 1, 2016, Halstead, Inc., purchased 69,000 shares of Sedgwick Company common stock for $1,456,000, giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period 0.5 points Net Income $392,000 443,000 605,000 Annual...
On January 1, 2017, Ridge Road Company acquired 30 percent of the voting shares of Sauk Trail, Inc., for $4,400,000 in cash. Both companies provide commercial Internet support services but serve markets in different industries. Ridae 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...
On July 1, 2018, Tremen Corporation acquired 40% of the shares of Delany Company. Tremen paid $3,170,000 for the investment, and that amount is exactly equal to 40% of the book value of identifiable net assets on Delany's balance sheet. Delany recognized net income of $1,200,000 for 2018, and paid $180,000 of dividends each quarter to its shareholders. After all closing entries are made, Tremen's Investment in Delany Company account would have a balance of:
On January 1, 2016, Halstead, Inc., purchased 79,000 shares of Sedgwick Company common stock for $1,452,000, giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period. 2016 2017 2018 Net Income $386,000 496,000 600,000 Annual...
On January 1, 2016, Halstead, Inc., purchased 79,000 shares of Sedgwick Company common stock for $1,402.000.giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period. 2016 2017 2018 Net Income $400,000 425,000 594,000 Annual Cash...
On January 1, 2016, Halstead, Inc., purchased 84,000 shares of Sedgwick Company common stock for $1,499,000, giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period. Annual Cash Dividends (pai quarterly) $122,ee8 128,000 167,000 Net...
3 On January 1, 2016, Halstead, Inc., purchased 69,000 shares of Sedgwick Company common stock for $1,456,000, giving Halstead 25 percent ownership and the ability to apply significant influence over Sedgwick. Any excess of cost over book value acquired was attributed solely to goodwill. Sedgwick reports net income and dividends as follows. These amounts are assumed to have occurred evenly throughout these years. Dividends are declared and paid in the same period 0.5 points Net Income $392,000 443,000 605,000 Annual...
Most questions answered within 3 hours.
-
You are one of the first engineers hired into the
manufacturing engineering department at a brand...
asked 26 seconds ago -
Suppose car models A, B, and C are popular among drivers.
Suppose 12% of the drivers...
asked 17 minutes ago -
write a program that finds the number of zeros in an 8-bit data
item using assembly...
asked 18 minutes ago -
Which statement is always true: The total energy of a closed
system...
A) is always equally...
asked 32 minutes ago -
find the critical value associated with a right sided hypothesis of
the mean using a sample...
asked 2 hours ago -
Which of the following statements is true with respect to a
simple linear regression model?
a....
asked 3 hours ago -
The energy required to remove an electron from a surface of a
solid element is called...
asked 4 hours ago -
How would you train your employees to avoid risks of using
mobile devices?
asked 5 hours ago -
Assume Kw = 1.01 ✕ 10−14
For pure water, we can calculate [H3O+ ] = [OH...
asked 5 hours ago -
Suppose that on a temperature scale X, water boils at 203.0°X
and freezes at -105.7°X. What...
asked 6 hours ago -
BaS crystallizes in a cubic unit cell with S2- ions on each
corner and each face....
asked 7 hours ago -
A. 0≤P(Oi)≤10≤P(Oi)≤1 for each i
B. P(Oi)≤0P(Oi)≤0
C. P(Oi)=1+P(OCi)P(Oi)=1+P(OiC)
D. P(Oi)≥1P(Oi)≥1
If an experiment consists of...
asked 8 hours ago