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bearhunter [10]
3 years ago
6

Assume an investor company acquires for $320,000 an 8% investment in the common stock of an investee company on February 15, 201

8. The investor determined the common stock of the investee has a readily determinable fair value. On December 31, 2018, the fair value of the 8% common stock investment is $340,000, and the investor company made made all of the appropriate adjustments in preparation of the annual financial statements. On March 1, 2019, the investor company acquires an additional 17% of common stock of the investee for $765,000, thereby increasing the investor's overall ownership interest to 25%.
Required
a. For this question only, assume instead that the investor determined, on February 15, 2018, that the common stock of the investee does not have a readily determinable fair value. In addition, the investor company determined that the additional 17% common stock purchase on March 1, 2019 does qualify as an observable price change in orderly transaction. Prepare the journal entries the investor company should record on March 1, 2019.
Note: If a journal entry is not required, select "N/A" as your answers for the drop-down options and leave the Debit and Credit answers blank (zero).
Description Debit Credit
To adjust value of investment account.
To record the purchase of additional stock.
b. For this question only, assume instead that the investor determined, on February 15, 2018, that the common stock of the investee does not have a readily determinable fair value. In addition, the investor company determined that the additional 17% common stock purchase on March 1, 2019 does not qualify as an observable price change in orderly transaction. Prepare the journal entries the investor company should record on March 1, 2019.
Note: If a journal entry is not required, select "N/A" as your answers for the drop-down options and leave the Debit and Credit answers blank (zero).
Description Debit Credit
To adjust value of investment account.
To record the purchase of additional stock.
Business
1 answer:
SIZIF [17.4K]3 years ago
8 0

Answer:

1.6 Million.

Explanation:

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Adjusted balance method calculates interest using the balance at the _____ of a billing cycle, adjusted by any _____ made during
Elodia [21]

A. end; payments

B. beginning; purchases

C. beginning; payments

D. end; purchases

Answer:

C. beginning; payments

Explanation:

The adjusted balance method is a method that is usually used by banks in which they calculate the interest at the end of the period by taking the initial balance adding all the adjustments made to the account like a payment and then they calculate the interest using the end balance. According to this, the answer is that adjusted balance method calculates interest using the balance at the beginning of a billing cycle, adjusted by any payments made during the period.

           

8 0
4 years ago
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Raj is a 50% shareholder in an S corporation. In the current year, he is reporting $50,000 of salary, $2,000 of interest income,
ycow [4]

Answer:

B) $4,000

Explanation:

The computation is shown below

As the QBI deduction can be less of

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OR

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3 0
3 years ago
The stock of Cleaner Homes is currently selling for $15.40 a share. The new rights offering grants one right for each share of s
Kaylis [27]

Answer:

$0.60

Explanation:

Calculation for the value of one right

The first step is to calculate for the cost per share.

Using this formula

Cost per share =[New share price+(New Share right*Stock price)]/ (One right +New Share right)

Let plug in the formula

Cost per share [$13 + (3 × $15.40)] / (1 + 3)

Cost per share =$13+$46.20/4

Cost per share =$59.20/4

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The second step is to calculate for the Value of right.

Using this formula

Value of right=New share price-Cost per share

Let plug in the formula

Value of right = $15.40 - 14.80

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5 0
4 years ago
If ten executives have salaries of $80,000, six have salaries of $75,000, and three have salaries of $70,000, what is the median
Lapatulllka [165]

If ten executives have salaries of $80,000, six have salaries of $75,000, and three have salaries of $70,000, The median salary is $80,000

Total number of observation = 10+6+3=  19

Median = \frac{n+1}{2}   =20/2 = 10 th value

Reason:

The median is the middle score when they are arranged in ascending or descending order.

Since there are a total of 19 observed values, the tenth value is the median $80,000

What is the median ?

The median is the middle number arranged in , ascending or descending order of numbers and can be more detailed  of that data set than the average.

Why is median important?

The median is important because it gives us an information about the  the center value of data and its location. The median tends to be more helpful to calculate than the mean when a distribution is skewed and/or has outliers.

Learn more about median:

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3 0
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egoroff_w [7]
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