Homework Answers
An impairment loss arises when the carrying value of an asset is more than its recoverable amount.
Carrying value of plant XT = Cost - Accumulated depreciation = $2900000 - $1600000 = $1300000.
Recoverable amount = $400000
Impairment loss = $1300000 - $400000 = $900000
a.
| Account Name | Dr. | Cr. |
| Impairment loss | 900000 | |
| Plant XT | 900000 | |
| (To record impairment of assets) |
Kindly select the appropriate account names from the drop-downs since the same have not been provided with the question.
b. Net book value: $400000
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a) $1,600,000
b) $2,100,000
c) $2,900,000
d) $3,200,000
3) What is 2020 equity in net income of Salem, reported
on Portland's books using the complete equity method?
a) $400,000
b) $900,000...
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Ch. 4 MC
Can someone please explain the multiple choice
answers?
1) On the 2020 consolidation working paper, elimination
entry (R) reduces Investment in Salem by:
a) $3,100,000
b) $5,200,000
c) $6,400,000
d) $8,000,000
2) On the 2020 consolidation working paper, elimination
entry (O) increases consolidated operating expenses
by:
a) $1,600,000
b) $2,100,000
c) $2,900,000
d) $3,200,000
3) What is 2020 equity in net income of Salem, reported
on Portland's books using the complete equity method?
a) $400,000
b) $900,000...
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On July 31, 2017, Crane Company paid $2,750,000 to acquire all of
the common stock of Conchita Incorporated, which became a division
of Crane. Conchita reported the following balance sheet at the time
of the acquisition.
Current assets
$830,000
Current liabilities
$530,000
Noncurrent assets
2,450,000
Long-term liabilities
430,000
Total assets
$3,280,000
Stockholders’ equity
2,320,000
Total liabilities and stockholders’
equity
$3,280,000
It was determined at the date of the purchase that the fair value
of the identifiable net assets...
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