1 answer

Assume that on January 1, 2013, an investor company acquired 100% of the outstanding voting common...

Question:

Assume that on January 1, 2013, an investor company acquired 100% of the outstanding voting common stock of an investee compa

Assume that on January 1, 2013, an investor company acquired 100% of the outstanding voting common stock of an investee company. The following financial statement information is for the investor company and the investee company on January 1, 2013, prepared immediately before this transaction. Book Values Investor Investee Receivables & inventaries $150,000 $75,000 Land 300,000 150,000 Property & equipment 337,500 150,000 Total assets $787,500 $375,000 Liabilities $225,000 $120,000 Common stock ($2 par) 30,000 15,000 Additional paid-in capital 420,000 225,000 Retained earnings 112,500 15,000 Total liabilities & equity $787,500 $375,000 Compute the investment account (market value equals book value) Assume that the fair values of the investee's net assets approximated the recorded book values of the investee's net assets, and the transaction resulted in no recorded goodwill or bargain purchase gain. What is the balance in the pre-consolidation "investment in investee" account on the investor company's books on January 1, 2013, immediately after the acquisition of the investee company voting common stock? Not enough information provided $255,000 $15,000 $225,000

Answers

Answer - option B is $255,000

Land Particulars Amoont Receivables & Inventories 75,000 150,000 Property and equipment 150,000 Total Assets - 375,000 Less:

.

Similar Solved Questions

1 answer
Maham has a 2.5 DOL (degree of operating leverage) and a 2.0 DFL (degree of financial...
Maham has a 2.5 DOL (degree of operating leverage) and a 2.0 DFL (degree of financial leverage). If it wants a 35% increase in EPS, what increase in sales does it need? a. 6% b. 7% c. 9% d. 35%...
1 answer
Suppose that the height (in centimeters) of a candle is a linear function of the amount...
Suppose that the height (in centimeters) of a candle is a linear function of the amount of time in hours) it has been burning. After 11 hours of burning, a candle has a height of 19.8 centimeters. After 26 hours of burning, its height is 16.8 centimeters. What is the height of the candle after 19 ho...
1 answer
Which may involve the gradual process of chromosome walking Ohen, human disease genes are known to...
which may involve the gradual process of chromosome walking Ohen, human disease genes are known to be within a certain region of a chromosome blowing them to be doned by O O O genome sequencing nuorescent in situ hybridization transgenic rescue positional cloning O...
1 answer
Suppose that JPMorgan Chase sells $300 million in Treasury bills to the Fed. a. Use T-accounts...
Suppose that JPMorgan Chase sells $300 million in Treasury bills to the Fed. a. Use T-accounts to show the immediate impact of this sale on the balance sheets of JPMorgan Chase and the Fed. (Enter your responses as integers. Include a minus sign to indicate a negative change, but do not include a pl...
1 answer
Question 2 - (25 points) Consider an investor who agrees to buy three March 2020 gold...
Question 2 - (25 points) Consider an investor who agrees to buy three March 2020 gold future con- tracts on the New York Mercantile Exchange (NYMEX). Suppose that the current futures price is $1275.80 per ounce. Because the contract size is 100 ounces, the investor has contracted to buy a total of 3...
1 answer
For the beam shown, calculate the Reactions at A and B, and then draw the Shear...
For the beam shown, calculate the Reactions at A and B, and then draw the Shear and Bending Moment diagrams. Consider the loading P=29 kN/m. p D А B 40 KN 40 KN 0.6 m 1.8 m 0.6 m...
1 answer
Background Measles outbreaks have occurred in numerous communities in the United States this year Responses to...
Background Measles outbreaks have occurred in numerous communities in the United States this year Responses to this public health threat have varied. This discussion focuses on one type of response. Proposition To decrease the spread of measles, parents or guardians who do not vaccinate their childr...
1 answer
Bowman Corporation is considering an investment in special-purpose equipment to enable the company to obtain a...
Bowman Corporation is considering an investment in special-purpose equipment to enable the company to obtain a four-year government contract for the manufacture of a special item. The equipment costs $95,000 and would have no salvage value when the contract expires at the end of the four years. Esti...
1 answer
. How many liters of ethane, measured at 29 degrees Celsius  and 867 mm Hg, must be...
. How many liters of ethane, measured at 29 degrees Celsius  and 867 mm Hg, must be burned to give off 2.75 x 104 kJ of heat? 2 C2H6(g) + 7 O2(g) → 4 CO2(g) + 6H2O(l) H = -3.12 x 103 kJ...
1 answer
Can you please explain these as well Classify each of the following statements as positive (fact...
can you please explain these as well Classify each of the following statements as positive (fact based) or normative (opinion based). Explain. 1. Society faces a short-run tradeoff between inflation and unemployment. 2. In a market, when quantity supplied exceeds quantity demanded, price tends to fa...
4 answers
Two children playing on the beach are pulling on an inner tube
Two children playing on the beach are pulling on an inner tube. One exerts a force of 45 N [N]. The other exerts a force of 60 N [SW]. What is the net force acting on the tube?...
1 answer
A disease has hit a city. The percentage of the population infected t days after the...
A disease has hit a city. The percentage of the population infected t days after the disease arrives is approximated by p(t) = 7te^(-1/10) for 0<=t<=40. After how many days is the percentage of infected people a maximum? What is the maximum percent of the population infected? The percentage o...
1 answer
You will be exploring the Fibonacci sequence through programming. Complete the following tasks: Research and take...
You will be exploring the Fibonacci sequence through programming. Complete the following tasks: Research and take note of the recursive formula F(n) that can be used to define the Fibonacci sequence. Design a simple program, using pseudocode, to implement the recursive formula you found in part (a)...
1 answer
Suppose 98% of all daily transactions at a bank are processed correctly. The bank selects the...
Suppose 98% of all daily transactions at a bank are processed correctly. The bank selects the last 100 transactions at the end of the day on Friday. Describe the sampling distribution of the sample number of correctly-processed transactions out of the 100....
1 answer
QUESTIONS Calculate the pH of a solution that has a[OH) = 4.20 x 10-SM (significant figures)...
QUESTIONS Calculate the pH of a solution that has a[OH) = 4.20 x 10-SM (significant figures) Click Save and Submit to save and submit. Click Save All Answers to save all answers. IF Type here to search o Re * $...
1 answer
During a research, the amount of Internet users was measured. Each time three random groups of...
During a research, the amount of Internet users was measured. Each time three random groups of 10,000 people of the average age of 20, 40, and 50 were considered. The data are as follows (x1 - the number of years since the beginning of the research, . - age, y - number of users): у X1 1800 155...