Blog

A company has been using the equity method to account for its investment. The company sells shares and does not continue to have significant influence. Which of the following statements is true?

On January 4, 2021, Mason Co. purchased 40,000 shares (40%) of the common stock of Hefly Corp., paying $560,000. At that time, the book value and fair value of Hefly’s net assets was $1,400,000. The investment gave Mason the ability to exercise significant influence over the operations of Hefly. During 2021, Hefly reported income of $150,000 and paid dividends of $40,000. On January 2, 2022, Mason sold 10,000 shares for $150,000.What is the appropriate journal entry to record the sale of the 10,000 shares?           A) Cash 150,000     Investment in Hefly   150,000 B) Cash 150,000     Investment in Hefly   130,000   Gain on sale of investment   20,000 C) Cash 150,000     Loss on sale of investment 1,000     Investment in Hefly   151,000 D) Cash 150,000     Investment in Hefly   149,000   Gain on sale of investment   1,000 E) Cash 150,000     Loss on sale of investment 10,000     Investment in Hefly   160,000                           A)    A Above             B)    B Above            C)    C Above            D)    D Above            E)    E Above

Most lesions of the penis are non-tender and painless. Which of the following conditions begins as a tender painful lesion?

Reeder Corp. acquired one hundred percent of O’Neill Inc. on January 1, 2019, at a price in excess of the subsidiary’s fair value. On that date, Reeder’s equipment (ten-year life) had a book value of $380,000 but a fair value of $460,000. O’Neill had equipment (ten-year life) with a book value of $240,000 and a fair value of $370,000. Reeder used the partial equity method to record its investment in O’Neill. On December 31, 2021, Reeder had equipment with a book value of $270,000 and a fair value of $400,000. O’Neill had equipment with a book value of $180,000 and a fair value of $300,000. What is the consolidated balance for the Equipment account as of December 31, 2021?

When you ask a patient to walk a straight line  placing heel to toe, you are assessing?

Watkins, Inc. acquires all of the outstanding stock of Glen Corporation on January 1, 2020. At that date, Glen owns only three assets and has no liabilities:     Book Value Fair Value Land $ 40,000   $ 50,000   Equipment (10-year life)   80,000     75,000   Building (20-year life)   200,000     300,000     If Watkins pays $450,000 in cash for Glen, what acquisition-date fair value allocation, net of amortization, should be attributed to the subsidiary’s Equipment in consolidation at December 31, 2022?                         A)    $(5,000).             B)    $80,000.            C)    $75,000.            D)    $73,500.            E)    $(3,500).

Luffman Inc. owns 30% of Bruce Inc. and appropriately applies the equity method. During the current year, Bruce bought inventory costing $52,000 and then sold it to Luffman for $80,000. At year-end, all of the merchandise had been sold by Luffman to other customers. What amount of gross profit on intra-entity sales must be deferred by Luffman?

If a country is a net importer, then this means it has a net inflow of capital investment. 

A 28-year-old client who is pregnant with her first child reports increased dental caries (cavities) since becoming pregnant. How should the nurse explain the likely cause for this change?

Wilkins Inc. acquired 100% of the voting common stock of Granger Inc. on January 1, 2021. The book value and fair value of Granger’s accounts on that date (prior to creating the combination) are as follows, along with the book value of Wilkins’s accounts:     Wilkins Book Value Granger Book Value Granger Fair Value Retained earnings, 1/1/21 $ 250,000 $ 240,000     Cash and receivables   170,000   70,000 $ 70,000 Inventory   230,000   180,000   210,000 Land   320,000   220,000   240,000 Buildings (net)   480,000   240,000   280,000 Equipment (net)   120,000   90,000   90,000 Liabilities   650,000   440,000   430,000 Common stock   360,000   80,000     Additional paid-in capital   60,000   40,000       Assume that Wilkins issued 13,000 shares of common stock with a $5 par value and a $46 fair value for all of the outstanding stock of Granger. What is the consolidated balance for Land as a result of this acquisition transaction?                         A)    $500,000.                        B)    $550,000.            C)    $540,000.            D)    $560,000.            E)    $530,000.