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On January 1, 2010, X Inc. purchased 25% of the voting shares of Y Inc. for...
On January 1, 2019, X Inc. purchased 25% of the voting shares of Y Inc. for $100,000. The investment is reported using the equity method, as X has significant influence over Y. Y's net income and declared dividends for the following three years are as follows: Net Income Dividends 2019 $50,000 $20,000 2020 $70,000 $80,000 2021 $30,000 $60,000 What would be the carrying value of X's Investment in Y at the end of 2021? Multiple Choice $100,000 $91,200 $97,500 $98,800...
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21. ( Oy On January 1, 2010, X Inc, purchased 12% of the voting shares of Y Inc. for $100.000 investment is reported at cost. X does not have significant influence over Y. Y's net icon and declared dividends for the following three years are as follows: Net Income Dividends 2010 2011 2012 $50,000 $70,000 $30,000 $20,000 $80,000 $60,000 Which of the following journal entries would have to...
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yean the ihanial ins ents svch as 38. Posthom Corporation acquired 20,000 of the 100,000 outstanding common shares of Stamp P. S8-59) Company on January 1, 2010, for a cash consideration of $200,000. During 2010, Stamp Company had net income of $120,000 and paid dividends of $80,000. At the end of 2010, shares of Stamp Company were trading for $11 each. If Posthom Corporation accounts for its investment in...
Pearl Company owns 60% of the voting shares of Jasper Inc. which it acquired on the latter’s incorporation on January 1, 2012, and accounts for its investment using the cost method. The Income Statements for the two companies for the year ended December 31, 2012, are as follows: Pearl Company Jasper Inc. Sales $ 3,200,000 $ 1,200,000 Dividend income 60,000 - 3,260,000 1,200,000 Cost of sales 2,400,000 900,000 Other expenses 300,000 ...
Belden, Inc. acquires 30 percent of the outstanding voting shares of Sheffield, Inc. on January 1, 2017, for $302,000, which gives Belden the ability to significantly influence Sheffield. Sheffield has a net book value of $780,000 at January 1, 2017. Sheffield's asset and liability accounts showed carrying amounts considered equal to fair values except for a copyright whose value accounted for Belden's excess cost over book value in its 30 percent purchase. The copyright had a remaining life of 16...
Boardman, Inc. acquires 40% of the outstanding voting shares of Simon, Inc. on January 1, 2017, for $380,000, which gives Boardman the ability to significantly influence Simon. Simon has a net book value of $900,000 on January 1, 2017. Simon’s asset and liability accounts showed carrying amounts considered equal to fair values except for a copyright whose value accounted for Boardman’s excess cost over book value in its 40% purchase. The copyright had a remaining life of 10 years on...
Problem - On January 1, 2018, American Corporation purchased 25% of the outstanding voting shares of Short Supplies common stock for $210,000 cash. On that date, Short's book value and fair walu were both $40,000. The equity method is deemed appropriate for this investment Short's net income reported on December 31, 2018, was 50,000. During 2018, Short also paid cash dividends in the amount of $24.000 Required: Prepare the journal entries necessary to record the above information on American Corporation's...
Belden, Inc. acquires 30 percent of the outstanding voting shares of Sheffield, Inc. on January 1, 2017, for $320,000, which gives Belden the ability to significantly influence Sheffield. Sheffield has a net book value of $828,000 at January 1, 2017. Sheffield's asset and liability accounts showed carrying amounts considered equal to fair values except for a copyright whose value accounted for Belden's excess cost over book value in its 30 percent purchase. The copyright had a remaining life of 16...
On January 1, 2021, American Corporation purchased 30% of the outstanding voting shares of Short Supplies common stock for $267.000 cash. On that date, Short's book value and fair value were both $890,000. The equity method is deemed appropriate for this investment. Short's net income reported on December 31, 2021, was $85,000. During 2021, Short also paid cash dividends in the amount of $26.500. Required: Compute the amount that would be reported for the investment on American Corporation's financial statements...
Belden, Inc. acquires 30 percent of the outstanding voting shares of Sheffield, Inc. on January 1, 2017, for $324,000, which gives Belden the ability to significantly influence Sheffield. Sheffield has a net book value of $792,000 at January 1, 2017. Sheffield's asset and liability accounts showed carrying amounts considered equal to fair values except for a copyright whose value accounted for Belden's excess cost over book value in its 30 percent purchase. The copyright had a remaining life of 16...