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Phoenix [80]
3 years ago
14

When Jolt Co. acquired 75% of the common stock of Yelts Corp., Yelts owned land with a book value of $70, 000 and a fair value o

f $100, 000. What amount should have been reported for the land in a consolidated balance sheet at the acquisition date?
A) $ 52, 500.
B) $ 70, 000.
C) $ 75, 000.
D) $ 92, 500.
E) $ 100, 000.
Business
1 answer:
Serjik [45]3 years ago
5 0

Answer:

E) $ 100, 000.

Explanation:

Under consolidation when the share holding is 50% or more, then it is a parent, subsidiary relationship and in that case equity method is followed.

All the assets of subsidiary are reported in the balance sheet of holding company also. This is to be reported at fair market value.

The minority shareholding is calculated for their share and shown separately.

But all assets are recorded at fair value.

Thus, the correct option shall be:

$100,000 being the fair value of land.

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Check the attached file for the answer.

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Use the three-step demand-supply analysis discussed in class to analyze changes to the equilibrium price, and quantity in the ca
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7 0
2 years ago
Pepe, Incorporated acquired 60% of Devin Company on January 1, 2017. On that date Devin sold equipment to Pepe for $45,000. The
krek1111 [17]

Answer:

The loss on equipment recognized by Devin on its internal accounting records for 2017 is $9,000

Explanation:

By using the given information which is mentioned in the question, first we have to calculate the book value of equipment.

So, the book value of the equipment is equals to

= Cost price - accumulated depreciation

= $120,000 - $66,000

= $54,000

Now we can calculate the loss or gain on sale of equipment which is equals to

= Sale price - book value

= $45,000 - $54,000

= - $9,000

Since, the amount shows negative which means the company has suffered a loss of $9,000 on equipment

The other things like net income of 2017 and 2018 is irrelevant because it tells the net income of overall company not for equipment. So, it is not being considered while computation

Hence,  the loss on equipment recognized by Devin on its internal accounting records for 2017 is $9,000

7 0
3 years ago
Shauna Lee Company expects the following for 2024​: • Net cash provided by operating activities of $140,000. • Net cash provided
Assoli18 [71]

Answer:

See below

Explanation:

Computation of Cash flow

Net cash provided by operating activities

$140,000

Less:

Net cash used for investing activities

($86,000)

Less:

Net cash provided by financing activities

(64,000)

Ending cash balance

($10,000)

Therefore, Lee would expect free cash flow of ($10,000) for 2024.

6 0
2 years ago
Allure Company manufactures and distributes two products, M and XY. Overhead costs are currently allocated using the number of u
AVprozaik [17]

Answer:

Option (b) is correct.

Explanation:

Given that,

Total Overhead Cost = $477,000

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Number of Units of Product M = 108,000

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= (Total Overhead Cost ÷ Number of units produced in total) × Number of Units of Product XY

= ($477,000 ÷ 180,000) × 72,000

= $2.65 × 72,000

= $190,800

5 0
3 years ago
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