On January 1, 2009, (A) Co. acquired all of the common stock of (B) Corp. For 2009, (B) earned net income of JD 360,000 and paid dividends of JD 190,000. Amortization of the patent allocation that was included in the acquisition was JD 6,000. 1. How much difference would there have been in (B)'s income with regard to the effect of the investment, between using the equity method or using the cost value method? 2. How much difference would there have been in (A)'s income with regard to the effect of the investment, between using the equity method or using the partial equity method

On January 1, 2009, (A) Co. acquired all of the common stock of (B) Corp. For 2009, (B) earned net income of JD 360,000 and paid dividends of JD 190,000. Amortization of the patent allocation that was included in the acquisition was JD 6,000. 1. How much difference would there have been in (B)'s income with regard to the effect of the investment, between using the equity method or using the cost value method? 2. How much difference would there have been in (A)'s income with regard to the effect of the investment, between using the equity method or using the partial equity method

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 19E

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