Worksheets19A2 - Advanced Financial Accounting - Stock Investment IV
Total questions: 5
Worksheet time: 4mins
What portion of the subsidiary stockholders’ equity account balances should be eliminated in preparing the consolidation balance sheet?
Common stock
Additional paid in capital
Retained Earnings
All of the balances are eliminated
Ben purchased 15 percent of Toy Company’s 100,000 shares of common stock on January 2 for $200,000. On December 31, Ben purchased an additional 30,000 shares of Toy for $400,000. There was no goodwill as a result of either acquisition, and Toy had not issued any additional stock during the year. Toy reported earnings of $700,000 for the year. What amount should Ben report in its December 31 balance sheet as investment in Toy?
$440,000
$600,000
$705,000
$880,000
If Push Company owned 51 percent in the outstanding common stock of Shove Company, which reporting method would be appropriate?
Cost method
Consolidation
Equity method
Merger method
Mars Corporation paid $300,000 for a 25% interest in Lusy Corporation's common stock on January 1, 2010, but was not able to exercise significant influence over Lusy. During 2011, Mars reported income of $220,000, excluding its income from Lusy. Lusy reported net income of $60,000 during 2011 and paid dividends of $40,000. Mars should report net income for 2011 in the amount of … (a)
Mic Corporation acquired a 30% interest in Joan Incorporated at book value several years ago. Joan declared $200,000 dividends in 2010 and reported its net income for the year of $600,000. For 2010, Mic's Investment in Joan account should increase by ……
(a)
