ADVANCED ACCOUNTING W/ACCESS >CUSTOM<
14th Edition
ISBN: 9781307594683
Author: Hoyle
Publisher: MCG/CREATE
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Chapter 6, Problem 13P
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Redfield Company reports current earnings of $420,000 while declaring $52,000 in cash dividends. Snedeker Company earns $147,000 in net income and declares $13,000 in dividends. Redfield has held a 70 percent interest in Snedeker for several years, an investment with an acquisition-date excess fair over book value attributable solely to goodwill. Redfield uses the initial value method to account for these shares.
On January 1 of the current year, Snedeker acquired in the open market $51,600 of Redfield’s 8 percent bonds. The bonds had originally been issued several years ago at 92, reflecting a 10 percent effective interest rate. On the date of purchase, the carrying amount of the bonds payable was $50,400. Snedeker paid $49,200 based on a 12 percent effective interest rate over the remaining life of the bonds.
What is the noncontrolling interest’s share of consolidated net income?
$40,200
$44,100
$40,560
$44,460
Aaron Company’s books show current earnings of $430,000 and $46,000 in cash dividends. Zeese Company earns $164,000 in net income and declares $11,500 in dividends. Aaron has held a 70 percent interest in Zeese for several years, an investment with an acquisition-date excess fair over book value attributable solely to goodwill. Aaron uses the initial value method to account for these shares and includes dividend income in its internal earnings reports.On January 1 of the current year, Zeese acquired in the open market $64,400 of Aaron’s 8 percent bonds. The bonds had originally been issued several years ago at 92, reflecting a 10 percent effective interest rate. On the date of purchase, the carrying amount of the bonds payable was $60,200. Zeese paid $56,000 based on a 12 percent effective interest rate over the remaining life of the bonds.What is consolidated net income for this year?a. $598,900b. $589,450c. $438,050d. $590,850
Choose the correct. Aaron Company’s books show current earnings of $430,000 and $46,000 in cash dividends. Zeese Company earns $164,000 in net income and declares $11,500 in dividends. Aaron has held a 70 percent interest in Zeese for several years, an investment with an acquisition-date excess fair over book value attributable solely to goodwill. Aaron uses the initial value method to account for these shares and includes dividend income in its internal earnings reports.On January 1 of the current year, Zeese acquired in the open market $64,400 of Aaron’s 8 percent bonds. The bonds had originally been issued several years ago at 92, reflecting a 10 percent effective interest rate. On the date of purchase, the carrying amount of the bonds payable was $60,200. Zeese paid $56,000 based on a 12 percent effective interest rate over the remaining life of the bonds.What is consolidated net income for this year?a. $598,900b. $589,450c. $438,050d. $590,850
Chapter 6 Solutions
ADVANCED ACCOUNTING W/ACCESS >CUSTOM<
Ch. 6 - Prob. 1QCh. 6 - Prob. 2QCh. 6 - When is a firm required to consolidate the...Ch. 6 - Prob. 4QCh. 6 - Prob. 5QCh. 6 - Prob. 6QCh. 6 - Prob. 7QCh. 6 - Prob. 8QCh. 6 - Prob. 9QCh. 6 - Prob. 10Q
Ch. 6 - Prob. 11QCh. 6 - How do noncontrolling interest balances affect the...Ch. 6 - Prob. 13QCh. 6 - Prob. 14QCh. 6 - Prob. 15QCh. 6 - Prob. 16QCh. 6 - Prob. 17QCh. 6 - Prob. 1PCh. 6 - Prob. 2PCh. 6 - Prob. 3PCh. 6 - Prob. 4PCh. 6 - Prob. 5PCh. 6 - Prob. 6PCh. 6 - Problems 7 and 8 are based on the following...Ch. 6 - Prob. 8PCh. 6 - Bens man Corporation is computing EPS. One of its...Ch. 6 - Prob. 10PCh. 6 - Prob. 11PCh. 6 - Prob. 12PCh. 6 - Prob. 13PCh. 6 - Prob. 14PCh. 6 - Prob. 18PCh. 6 - Prob. 19PCh. 6 - Prob. 37PCh. 6 - Prob. 38PCh. 6 - Prob. 39PCh. 6 - Prob. 40PCh. 6 - Prob. 41PCh. 6 - Prob. 42P
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- Redfield Company reports current earnings of $420,000 while declaring $52,000 in cash dividends. Snedeker Company earns $147,000 in net income and declares $13,000 in dividends. Redfield has held a 70 percent interest in Snedeker for several years, an investment with an acquisition-date excess fair over book value attributable solely to goodwill. Redfield uses the initial value method to account for these shares.On January 1 of the current year, Snedeker acquired in the open market $51,600 of Redfield’s 8 percent bonds. The bonds had originally been issued several years ago at 92, reflecting a 10 percent effective interest rate. On the date of purchase, the carrying amount of the bonds payable was $50,400. Snedeker paid $49,200 based on a 12 percent effective interest rate over the remaining life of the bonds.What is the noncontrolling interest’s share of consolidated net income?a. $40,200b. $44,100c. $40,560d. $44,460arrow_forwardBlanton Corporation purchased 15% of the outstanding shares of common stock of Worton Corporation as a long-term investment. Subsequently, Worton Corporation reported net income and declared and paid cash dividends. What journal entry would Blanton Corporation use to record the dividends it receives?arrow_forwardAndrew Company purchased 800 ordinary shares of Valley Industries as a trading investment for P148,800. During the year, Valley Industries paid a cash dividend of P32 per share. At year-end, Valley’s shares were selling for P174 per share. In the income statement for the current year-end, what net amount of unrealized gain/loss and dividend revenue should be reported by Andrew Company?arrow_forward
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