Homework Answers
| Investment cost | 593400 | |
| Add: Net income share | 52800 | =132000*40% |
| Less: Dividends received | -28000 | =70000*40% |
| Less: Amortization on Building | -11600 | =(203000*40%)/7 |
| Less: Amortization on Trademark | -14300 | =(357500*40%)/10 |
| Investment in Johnson Company balance | 592300 | |
| Option D $592,300 is correct |
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Franklin purchases 40 percent of Johnson Company on January 1 for $593,400. Although Franklin did not...
Franklin purchases 40 percent of Johnson Company on January 1 for $578,700. Although Franklin did not...
Franklin purchases 40 percent of Johnson Company on January 1 for $578,700. Although Franklin did not use it, this acquisition gave Franklin the ability to apply significant influence to Johnson's operating and financing policies. Johnson reports assets on that date of $1,509,000 with liabilities of $572,000. One building with a seven-year remaining life life is undervalued on Johnson's books by $274,750. Also, Johnson's book value for its trademark (10-year life) is undervalued by $235,000. During the year, Johnson reports net...
Problem 1-8 (LU 1-3, 1-4) 00 Franklin purchases 40 percent of Johnson Company on January 1...
Problem 1-8 (LU 1-3, 1-4) 00 Franklin purchases 40 percent of Johnson Company on January 1 for $617,100. Although Franklin did not use it, this acquisition gave Franklin the ability to apply significant influence to Johnson's operating and financing policies. Johnson reports assets on that date of $1,515,000 with liabilities of $548,000. One building with a seven-year remaining life life is undervalued on Johnson's books by $243,250. Also, Johnson's book value for its trademark (10-year life) is undervalued by $332,500....
Problem 1-8 (LU 1-3, 1-4) 00 Franklin purchases 40 percent of Johnson Company on January 1...
Problem 1-8 (LU 1-3, 1-4) 00 Franklin purchases 40 percent of Johnson Company on January 1 for $617,100. Although Franklin did not use it, this acquisition gave Franklin the ability to apply significant influence to Johnson's operating and financing policies. Johnson reports assets on that date of $1,515,000 with liabilities of $548,000. One building with a seven-year remaining life life is undervalued on Johnson's books by $243,250. Also, Johnson's book value for its trademark (10-year life) is undervalued by $332,500....
8 to 11? could you also write a solution The Equity Method of Accounting for Investments...
8 to 11? could you also write a solution
The Equity Method of Accounting for Investments 29 8. Franklin purchases 40 percent of Johnson Company on January 1 for $500,000. Although did not use it, this acquisition gave Franklin the ability to apply sinificant influence to Johnson operating and financing policies. Johnson reports assets on that date of $1.400,000 with lat of $500,000. One building with a seven-year remaining life is undervalued on Johnson's books $140,000. Also, Johnson's book value...
On January 2, 2018, Johnson Company paid $262,000 to acquire 12,000 shares of Pets Corp. The...
On January 2, 2018, Johnson Company paid $262,000 to acquire 12,000 shares of Pets Corp. The investment represented 25% of the total shares outstanding of Pets Corp. and gave Johnson Company the ability to exert significant influence upon the operations of Pets Corp. During the year ended December 31, 2018, Pets Corp. paid dividends of $1.75 per share (declared and paid on November 12, 2018) and reported income of $269,000. The market value of Pets Corp. stock at December 31,...
On January 2, 2018, Johnson Company paid $262,000 to acquire 12,000 shares of Pets Corp. The...
On January 2, 2018, Johnson Company paid $262,000 to acquire 12,000 shares of Pets Corp. The investment represented 25% of the total shares outstanding of Pets Corp. and gave Johnson Company the ability to exert significant influence upon the operations of Pets Corp. During the year ended December 31, 2018, Pets Corp. paid dividends of $1.75 per share (declared and paid on November 12, 2018) and reported income of $269,000. The market value of Pets Corp. stock at December 31,...
On January 3, 2015, Matteson Corporation acquired 40 percent of the outstanding common stock of O'Toole...
On January 3, 2015, Matteson Corporation acquired 40 percent of the outstanding common stock of O'Toole Company for $1,246,000. This acquisition gave Matteson the ability to exercise significant influence over the investee. The book value of the acquired shares was $904,000. Any excess cost over the underlying book value was assigned to a copyright that was undervalued on its balance sheet. This copyright has a remaining useful life of 10 years. For the year ended December 31, 2015, O'Toole reported...
On January 3, 2018, Matteson Corporation acquired 30 percent of the outstanding common stock of O...
On January 3, 2018, Matteson Corporation acquired 30 percent of the outstanding common stock of O Toole Company for $1,209,000. This acquisition gave Matteson the ability to exercise significant influence over the investee. The book value of the acquired shares was $840,000. Any excess cost over the underlying book value was assigned to a copyright that was undervalued on its balance sheet. This copyright has a remaining useful life of 10 years. For the year ended December 31, 2018, O'Toole...
On July 1, 2016, Killearn Company acquired 105,000 of the outstanding shares of Shaun Company for...
On July 1, 2016, Killearn Company acquired 105,000 of the outstanding shares of Shaun Company for $19 per share. This acquisition gave Killearn a 40 percent ownership of Shaun and allowed Killearn to significantly influence the investee's decisions. As of July 1, 2016, the investee had assets with a book value of $5 million and liabilities of $1,101,500. At the time, Shaun held equipment appraised at $280,000 above book value; it was considered to have a seven-year remaining life with...
Milani, Inc, acquired 10 percent of Seida Corporation on January 1, 2017, for $192,000 and appropriately...
Milani, Inc, acquired 10 percent of Seida Corporation on January 1, 2017, for $192,000 and appropriately accounted for the investment using the fair-value method. On January 1, 2018, Milani purchased an additional 30 percent of Seida for $638,000 which resulted in significant influence over Seida. On that date, the fair value of Seida's common stock was $1,970,000 in total. Seida's January 1, 2018 book value equaled $1,820,000, although land was undervalued by $139,000. Any additional excess fair value over Seida's...
Franklin purchases 40 percent of Johnson Company on January 1 for $578,700. Although Franklin did not use it, this acquisition gave Franklin the ability to apply significant influence to Johnson's operating and financing policies. Johnson reports assets on that date of $1,509,000 with liabilities of $572,000. One building with a seven-year remaining life life is undervalued on Johnson's books by $274,750. Also, Johnson's book value for its trademark (10-year life) is undervalued by $235,000. During the year, Johnson reports net...
Problem 1-8 (LU 1-3, 1-4) 00 Franklin purchases 40 percent of Johnson Company on January 1 for $617,100. Although Franklin did not use it, this acquisition gave Franklin the ability to apply significant influence to Johnson's operating and financing policies. Johnson reports assets on that date of $1,515,000 with liabilities of $548,000. One building with a seven-year remaining life life is undervalued on Johnson's books by $243,250. Also, Johnson's book value for its trademark (10-year life) is undervalued by $332,500....
Problem 1-8 (LU 1-3, 1-4) 00 Franklin purchases 40 percent of Johnson Company on January 1 for $617,100. Although Franklin did not use it, this acquisition gave Franklin the ability to apply significant influence to Johnson's operating and financing policies. Johnson reports assets on that date of $1,515,000 with liabilities of $548,000. One building with a seven-year remaining life life is undervalued on Johnson's books by $243,250. Also, Johnson's book value for its trademark (10-year life) is undervalued by $332,500....
8 to 11? could you also write a solution
The Equity Method of Accounting for Investments 29 8. Franklin purchases 40 percent of Johnson Company on January 1 for $500,000. Although did not use it, this acquisition gave Franklin the ability to apply sinificant influence to Johnson operating and financing policies. Johnson reports assets on that date of $1.400,000 with lat of $500,000. One building with a seven-year remaining life is undervalued on Johnson's books $140,000. Also, Johnson's book value...
On January 3, 2015, Matteson Corporation acquired 40 percent of the outstanding common stock of O'Toole Company for $1,246,000. This acquisition gave Matteson the ability to exercise significant influence over the investee. The book value of the acquired shares was $904,000. Any excess cost over the underlying book value was assigned to a copyright that was undervalued on its balance sheet. This copyright has a remaining useful life of 10 years. For the year ended December 31, 2015, O'Toole reported...
On January 3, 2018, Matteson Corporation acquired 30 percent of the outstanding common stock of O Toole Company for $1,209,000. This acquisition gave Matteson the ability to exercise significant influence over the investee. The book value of the acquired shares was $840,000. Any excess cost over the underlying book value was assigned to a copyright that was undervalued on its balance sheet. This copyright has a remaining useful life of 10 years. For the year ended December 31, 2018, O'Toole...
Milani, Inc, acquired 10 percent of Seida Corporation on January 1, 2017, for $192,000 and appropriately accounted for the investment using the fair-value method. On January 1, 2018, Milani purchased an additional 30 percent of Seida for $638,000 which resulted in significant influence over Seida. On that date, the fair value of Seida's common stock was $1,970,000 in total. Seida's January 1, 2018 book value equaled $1,820,000, although land was undervalued by $139,000. Any additional excess fair value over Seida's...
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