Problems P 3-1 Corvallis Corporation owns 80% of the stock of Little Harrisburg, Inc. At December 31, 2012, Little Harrisburg had the following summarized balance sheet: Current assets LITTLE HARRISBURG, INC. Balance Sheet Property, plant, and equipment (net) December 31, 2012 $100,000 400,000 $500,000 Current liabilities Long-term debt Capital stock Retained earnings $ 50,000 150,000 50,000 250,000 $500,000 The earnings of Little Harrisburg, Inc., for 2012 were $50,000 after tax. Required a. What would be the amount of noncontrolling interest on the balance sheet of Corvallis Corporation? b. What would be the noncontrolling interest in share of earnings on the income statement of Corvallis Corporation? P 3-2 You have just started as a staff auditor for a small CPA firm. During the course of the audit, you discover the following items related to a single client firm: a. During the year, the firm declared and paid $10,000 in dividends. b. Your client has been named defendant in a legal suit involving a material amount. You have received from the client's counsel a statement indicating little likelihood of loss. c. Because of cost control actions and general employee dissatisfaction, it is like that the client will suffer a costly strike in the near future. d. Twenty days after closing, the client suffered a mai
Problems P 3-1 Corvallis Corporation owns 80% of the stock of Little Harrisburg, Inc. At December 31, 2012, Little Harrisburg had the following summarized balance sheet: Current assets LITTLE HARRISBURG, INC. Balance Sheet Property, plant, and equipment (net) December 31, 2012 $100,000 400,000 $500,000 Current liabilities Long-term debt Capital stock Retained earnings $ 50,000 150,000 50,000 250,000 $500,000 The earnings of Little Harrisburg, Inc., for 2012 were $50,000 after tax. Required a. What would be the amount of noncontrolling interest on the balance sheet of Corvallis Corporation? b. What would be the noncontrolling interest in share of earnings on the income statement of Corvallis Corporation? P 3-2 You have just started as a staff auditor for a small CPA firm. During the course of the audit, you discover the following items related to a single client firm: a. During the year, the firm declared and paid $10,000 in dividends. b. Your client has been named defendant in a legal suit involving a material amount. You have received from the client's counsel a statement indicating little likelihood of loss. c. Because of cost control actions and general employee dissatisfaction, it is like that the client will suffer a costly strike in the near future. d. Twenty days after closing, the client suffered a mai
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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