Exam 1 Sunday ses 220201 ACCT-400B-01 Acker Inc. bought 40% of Howell Co. on January 1,...
Acker Inc. bought 40% of Howell Co. on January 1, 2020 for $576,000. The equity method of accounting was used. The book value and fair value of the net assets of Howell on that date were $1,440,000. Acker began supplying inventory to Howell as follows: Year 2020 2021 Cost to Acker $55,000 $70,000 Transfer Price $ 75,000 $110,000 Amount Held by Howell at Year- End $15,000 $55,000 Howell reported net income of $100,000 in 2020 and $120,000 in 2021 while...
Acker Inc. bought 40% of Howell Co. on January 1, 2020 for $576,000. The equity method of accounting was used. The book value and fair value of the net assets of Howell on that date were $1,440,000. Acker began supplying inventory to Howell as follows: Year 2020 2021 Cost to Acker $55,000 $70,000 Transfer Price $ 75,000 $110,000 Amount Held by Howell at Year- End $15,000 $55,000 Howell reported net income of $100,000 in 2020 and $120,000 in 2021 while...
RUL ne Exam 1 Sunday September 20, 2020 6:00 pm - 6:00 PHI 220201 ACCT-4008-01 My courses Question 33 Not yet answered Marked out of 2.50 Flag question On January 1, 2020, Archer, Incorporated, paid $100,000 for a 35% interest in Harley Corporation. This investee had assets with a book value of $550,000 and liabilities of $300,000. A patent held by Harley having a book value of $10,000 was actually worth $22,000 with a six-year remaining life. Any goodwill associated...
On January 1, Year 1. Investor, Inc. acquired 40% of the outstanding common stock of Investee Co, for $530,000. Investee's net assets on that date totaled $1.2 million. Any excess of cost over book value is attributable to a trade name with a 20-year remaining life. Investee immediately began supplying inventory to Investor as follows: Year Year Year 2 Transfer Price $100,000 $150,000 Cost to Investec $70,000 $96,000 Amount Held by Investor at Year-End (at Transfer Price) $25,000 $45,000 Inventory...
Harper, Inc., acquires 40 percent of the outstanding voting stock of Kinman Company on January 1, 2020, for $259,200 in cash. The book value of Kinman's net assets on that date was $465,000, although one of the company's buildings, with a $72,200 carrying amount, was actually worth $129,700. This building had a 10-year remaining life. Kinman owned a royalty agreement with a 20-year remaining life that was undervalued by $125,500. Kinman sold inventory with an original cost of $109,200 to...
Harper, Inc. acquires 40 percent of the outstanding voting stock of Kinman Company on January 1, 2017, for $276,500 in cash. The book value of Kinman's net assets on that date was $530,000, although one of the company's buildings, with a $71,600 carrying amount, was actually worth $122,850. This building had a 10-year remaining life. Kinman owned a royalty agreement with a 20-year remaining life that was undervalued by $110,000. Kinman sold inventory with an original cost of $52,500 to...
TunaCo purchases 25% of Stanley, Inc. on January 1 of the current year for $505,000. This acquisition gives TunaCo the ability to significantly influence Stanley's operating and financing policies. Stanley reports assets on that date of $1,600,000 with liabilities of $400,000. One building with a 15-year remaining life has a book value of $100,000 and a fair market value of $400,000. Any remaining excess must be Goodwill. During the current year, Stanley reports net income of $140,000 while paying dividends...