Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported net income of $95,000 and declared dividends of $35,000 during the year. How much would Ramiro adjust its investment in Marco Company under the equity method? would it increase or decrease

Q: On July 1, 2021, Bird Inc., a private enterprise, acquired 1,250 shares of Duck Ltd. for $75,000.…

A: Shares refer to the unit of ownership in an organization. Shares are issued to raise funds against…

Q: On May 20, Montero Company paid $180,000 to acquire 55 shares (9%) of ORD Corporation as a long-term…

A: The companies invest in long-term investments to make additional income on the surplus funds at…

Q: The Island Cruises stock is publically traded. During the year, Island Cruises reported net income…

A: Return on investment is a percentage of net income with respect to its investment. It is a prominent…

Q: On July 1, 2021, Tremen Corporation acquired 40% of the shares of Delany Company. Tremen paid…

A: The share and security acquired by the business entity are classified as assets. The ending balance…

Q: An investor company purchased 42,000 of the 100,000 outstanding shares of the investee company's…

A: Equity method is a method of accounting for investments. This method is used when investor has…

Q: On January 4, 20Y6, Spandella Company purchased 160,000 shares of Filington Company directly from…

A: Journal: Recording of a business transactions in a chronological order.

Q: On January 4, 20Y4, Ferguson Company purchased 480,000 shares of Silva Company's common stock…

A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…

Q: On January 2, Todd Company acquired 40% of the outstanding stock of McGuire Company for $205,000.…

A: Given information is: Todd Company acquired 40% of the outstanding stock of McGuire Company for…

Q: Peter Inc. purchases 30% of Sam Ltd for $50,000 with significant influence. At year-end, Peter Inc.…

A: Solution: Holding of peter Inc. in Sam ltd = 30% As Peter Inc holds more than 20% in Sam ltd,…

Q: What should ABC report as investment income?

A: Investments: An investment is considered an asset. It is an amount invested by the investor in PPE…

Q: Pepito Company purchased 40% of the outstanding stock of Reyes Company on January 1.  Reyes reported…

A: Increase in Investment = Reported net income x Ownership percentage in Reyes Company Increase in…

Q: Ayayai Corporation purchased 300 common shares of Sigma Inc. for trading purposes for $9,300 on…

A: Purchases of 300 shares for $9300 i.e.$31per share

Q: On January 15 of the current year, Thomas Company purchased 2,800 shares of Dillon Company at a…

A: The income ( loss ) is the difference between the total sales price and the total cost of the…

Q: MANGO Company acquired 4,000 shares of KIWI Corporation ordinary shares on April 2, 2020 at a cost…

A: The trading investment is recognized at FVTPL and any changes in their fair value are recognized in…

Q: Wendy Day Kite Company owns 40% of the outstanding stock of Strong String Company. During the…

A: Financial statements are condensed summaries of transactions communicated in the form of reports for…

Q: elk Steel Company, which began operations in Year 1, had the following transactions and events in…

A: Under the equity method of accounting, investment balance is decreased by dividends received from…

Q: Bayview Company bought 1,000 shares of PLDT shares as equity investments on January 10, Year 2 at…

A: Investment in equity securities is one of the important asset of the business. Dividends are also…

Q: Kingbird Corporation acquired a 38% interest in Blue Company on January 1, 2021, for $480,000. At…

A: Balance of equity investment = Cost of purchase + Share of net income - Share of dividend

Q: On July 1, 2021, Bird Inc, a private enterprise, acquired 1,250 shares of Duckltd. tot 375, 000.…

A: Introduction: Financial transactions are tracked using journal entries. You enter transaction…

Q: On July 1, 2018, Tremen Corporation acquired 40% of the shares of Delany Company. Tremen paid…

A: Investment is the amount which is put into some assets or securities to gain some returns in future.…

Q: Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported…

A: The shares purchased of other company are treated as investment in the business.

Q: On January 1, 2021, Ildiko Corporation purchased a 35% interest in the common shares of Rance Ltd.…

A: In case of equity method of accounting for Investment then Investment income will be assessee share…

Q: On January 1, Ivanhoe Corporation purchased a 25% equity in Helbert Corporation for $152,000. At…

A: Investment in Helbert, December 31 = Stock Investments cost + Share of net income - Dividends…

Q: Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported…

A: When one company is holding significant amount of share of another company , then equity method of…

Q: On April 15, 2023, Rizzo Inc. purchased 34,500 shares of Hernandez, Inc. for $22 per share (passive…

A: The income statement shows the net income or net loss calculated by deducting the expenses from the…

Q: Lauralee, Inc. owns a 30% interest in Eastwood Co., giving it representation on the investee’s board…

A: Journal entry refers to posting of the transactions into the books of the entity or corporation and…

Q: Blanton Corporation purchased 15% of the outstanding shares of common stock of Worton Corporation as…

A: Journal entry: Journal entry is a set of economic events that can be measured in monetary terms.…

Q: Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported…

A: The share in net income is to be added to amount of investment

Q: On January 2, 2020, Samantha Company bought 10% of Camille Company's outstanding ordinary shares for…

A: The amount that Samantha Co. should report as investment in Camille Co. is as Follows.

Q: On December 15, 2021, Blue Company paid $100,000 for 8,0000 shares of Marble Company common stock.…

A: For the purpose of calculating investment by one company in another company the fair value of the…

Q: Kross company purchases an equity investment in Penno Company at a purchase price of 5,000,000…

A: Equity Method of Accounting: Companies typically utilise the equity method of accounting to…

Q: Acker Company bought 100% of Howell Company on 1/1/X1 for $1,440,000 and began applying the equity…

A: Expansion and growth are motives of business. Purchasing or acquiring other firms is one of the ways…

Q: how much should MANGO report as gain or loss on sale of investment?

A: The management sometimes invests in the stock market to acquire other corporations' shares for the…

Q: Sunland Corporation purchased  370 shares of Sherman Inc. common stock for $ 13,100 ( Sunland does…

A: Accounting for equity securities: FVTNI Classifies as fair value net income- measures at FV on B/S…

Q: Company P purchased 70% stock in Company S on Jan 1, 20X1 for S170,000. For the year 20X1, Company S…

A: Given: Company P purchased 70% stock in Company Son. On Jan 1, 20x1 for $200,000 including the net…

Q: At the beginning of the current year, WWW Company purchased 10% of RRR Company's outstanding…

A: When the company purchases the shares of the other company then the amount invested is recorded as…

Q: On January 4, 20Y4, Ferguson Company purchased 480,000 shares of Silva Company’s common stock…

A: Equity method of accounting is a method of accounting for investments. Investment in associate will…

Q: On January 4, Year 1, Ferguson Company purchased 64,000 shares of Silva Company directly from one of…

A: Equity method of accounting refers to the process of recording transactions under which the revenue…

Q: Carla, Inc. purchased 1,810 shares of Oneida Corporation common stock for $84,600. During the year.…

A: As per  IFRS 9, Equity investments are to be accounted as per Fair value through profit or loss…

Q: On January 4, 2018, Watts Co. purchased 40,000 shares (40%) of the common stock of Adams Corp.,…

A: The calculation of investment value per share has been made as follows:

Q: James Company purchased 900 shares of POP Company's stock as a long-term investment for $57,600.…

A: Formula: Purchase price per share = Total purchase value / Number of shares purchased

Q: Oriole Cosmetics acquired 10% of the 191,000 shares of common stock of Martinez Fashion at a total…

A: The journal entries are prepared to record daily transactions of the business.

Q: utstanding stock of Marco Company on January 1. Marco reported net income of $76,000 and declared…

A: The equity method of accounting is used to account for one organization's investment in another (the…

Q: On January 1, 2020 Rosen Company purchased 35,000 which is 15% of the total common stock owned by…

A: Answer:-  Common stock meaning:- A common stock is a form of stock generally issued to the majority…

Q: On January 1, 2018, Fisher Corporation paid $2,290,000 for 35 percent of the outstanding voting…

A: Investment: It refers to the process of using the currently held excess cash to earn profitable…

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.