Heidebrecht Design acquired 20% of the outstanding common stock of Quayle Company on January 1, 2014, by paying $800,000 for the
30,000 shares. Quayle declared and paid $0.30 per share cash dividends on March 15, June 15, September 15, and December 15, 2014. Quayle reported net income of $320,000 for the year. At December 31, 2014, the market price of Quayle common stock was $34 per share.Required:(a) Prepare the journal entries for Heidebrecht Design for 2014 assuming Heidebrecht Design cannot exercise significant influence over Quayle. (Use the cost method and assume that Quayle. common stock should be classified as a trading security.) Total dividend revenue $36,000(b) Prepare the journal entries for Heidebrecht Design for 2014, assuming Heidebrecht Design can exercise significant influence over Quayle. Use the equity method. Revenue from stock investments $64,000(c) Indicate the balance sheet and income statement account balances at December 31, 2014, under each method of accounting.
1 answer:
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Answer:
Explanation:
a) x1 = number of unit product 1 to produce , and
x2 number of unit product 2 to produce
A linear program that will maximize world light profit is the following
maximize subject to
Unit 1 is used both in products in 1 : 3 ratio which can be a maximum of 200 unit 2 is used in 2 : 2 ratio which can be maximum of 300
So, this can be written as the inequations
Profit functio is p = 0ne dollar on product A and two dollar on product B
= x + 2y
Now , we find a feasible area whose extremeties will give the maximum profit for, the graph is ( see attached file )
So on the graph, we can get the other extremeties of the shaded regional so which will not give maximum profit ,
Thus , the maximum possible profit is
p = ($1 * 125) + ($2 * 25)
= $175
