On July 1, 2013, Tremen Corporation acquired 40% of the shares of Delany Company. Tremen paid$3,000,000 for the investment, and that amount is exactly equal to 40% of the fair value of identifiable netassets on Delany's balance sheet. Delany recognized net income of $1,000,000 for 2013, and paid$150,000 quarterly dividends to its shareholders. After all closing entries are made, Tremen's "Investmentin Delany Company" account would have a balance of:A. $3,200,000.B. $3,160,000.C. $3,000,000.|D. $3,080,000.Mars Inc. has a defined benefit pension plan. On December 31 (the end of the fiscal year), the companyreceived the PB0 report from the actuary. The following information was included in the report: endingPBO, $110,000; benefits paid to retirees, $10,000; interest cost, $7,200. The discount rate applied by theactuary was 8%. What was the beginning PBO?A. $90,000.B. $100,000.C. $107,200.D. $112,000.A company reports pretax accounting income of $10 million, but because of a single temporarydifference, taxable income is $12 million. No temporary differences existed at the beginning ofthe year, and the tax rate is 40%. The journal entry regarding this temporary transaction includesa. Debit Income Tax Expense $4.8Mb. Debit DTA $2Mc. Credit Income Taxes Payable $4Md. None of the above

Carrying amount in the investment account will be calculated by adjusting the opening balances with…

Answered: On July 1, 2013, Tremen Corporation…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 25E

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Ponce Towers, Inc., had 50,000 shares of common stock and 10,000 shares of 100 par value, 8% preferred stock outstanding on January 1, 2011. Each share of preferred stock is convertible into four shares of common stock. The stock has not been converted. During the year, Ponce Towers issued additional shares of common stock as follows: For 2011, Ponce Towers, Inc., had income from continuing operations of 545,000 and a 72,000 loss from discontinued operations (net of tax). As vice president of finance for the firm, you have been asked to calculate earnings per share for 2011. The worksheet EPS has been provided to assist you.
Ponce Towers, Inc., had 50,000 shares of common stock and 10,000 shares of 100 par value, 8% preferred stock outstanding on January 1, 2011. Each share of preferred stock is convertible into four shares of common stock. The stock has not been converted. During the year, Ponce Towers issued additional shares of common stock as follows: For 2011, Ponce Towers, Inc., had income from continuing operations of 545,000 and a 72,000 loss from discontinued operations (net of tax). Open the file EPS from the website for this book at cengagebrain.com. Enter all input items (AF) in the appropriate cells in the Data Section. Enter all formulas in the appropriate cells in the Answer Section. Enter your name in cell A1. Save the completed file as EPS2. Print the worksheet when done. Also print your formulas. Check figure: Basic earnings per share from continuing operations (cell D29), 5.94.
On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a 30% corporate income tax rate. During 2019, Kittson earned net income of 67,000, and the following events occurred: 1. Cash dividends of 3 per share on 4,000 shares of common stock were declared and paid. 2. A small stock dividend was declared and issued. The dividend consisted of 600 shares of 10 par common stock. On the date of declaration, the market price of the companys common stock was 36 per share. 3. The company recalled and retired 500 shares of 100 par preferred stock. The call price was 125 per share; the stock had originally been issued for 110 per share. 4. The company discovered that it had erroneously recorded depreciation expense of 45,000 in 2018 for both financial reporting and income tax reporting. The correct depreciation for 2018 should have been 20,000. This is considered a material error. Required: 1. Prepare journal entries to record Items 1 through 4. 2. Prepare Kittsons statement of retained earnings for the year ended December 31, 2019.

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