Soft Bound Version for Advanced Accounting 13th Edition
13th Edition
ISBN: 9781260110579
Author: Hoyle
Publisher: McGraw Hill Education
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Chapter 6, Problem 40P
To determine
Compute basic and diluted EPS for Company B.
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The following separate income statements are for Burks Company and its 80 percent–owned subsidiary, Foreman Company:
Burks
Foreman
Revenues
$
(446,000
)
$
(346,000
)
Expenses
274,000
248,000
Gain on sale of equipment
0
(38,000
)
Equity earnings of subsidiary
(72,000
)
0
Net income
$
(244,000
)
$
(136,000
)
Outstanding common shares
60,000
40,000
Additional Information
Amortization expense resulting from Foreman’s excess acquisition-date fair value is $45,000 per year.
Burks has convertible preferred stock outstanding. Each of these 15,000 shares is paid a dividend of $4 per year. Each share can be converted into four shares of common stock.
Stock warrants to buy 20,000 shares of Foreman are also outstanding. For $20, each warrant can be converted into a share of Foreman’s common stock. The fair value of this stock is $25 throughout the year. Burks owns none of these warrants.
Foreman has convertible bonds payable…
The following separate income statements are for Burks Company and its 80 percent–owned subsidiary, Foreman Company:
Burks ForemanRevenues . . . . $(430,000) $(330,000)Expenses . . . . . 280,000 240,000Gain on sale –0– (30,000) of equipment Equity earnings of (64,000) -0-subsidiaryNet income . . $(214,000) $(120,000)Outstanding . . . 65000 40000 Common stock
Additional Information∙ Amortization expense resulting from Foreman’s excess acquisition-date fair value is $40,000 per year.∙ Burks has convertible preferred stock outstanding. Each of these 8,000 shares is paid a dividend of $4 per year. Each share can be converted into four shares of common stock.∙ Stock warrants to buy 20,000 shares of Foreman are also outstanding. For $15, each warrant can be converted into a share of Foreman’s common stock. The fair value of this stock is $20 throughout the year. Burks owns none of these…
Following are separate income statements for Austin, Inc., and its 80 percent owned subsidiary, Rio Grande Corporation as well as a consolidated statement for the business combination as a whole.
Austin
Rio Grande
Consolidated
Revenues
$
(700,000
)
$
(500,000
)
$
(1,200,000
)
Cost of goods sold
400,000
300,000
700,000
Operating expenses
100,000
70,000
195,000
Equity in earnings of Rio Grande
(84,000
)
Individual company net income
$
(284,000
)
$
(130,000
)
Consolidated net income
$
(305,000
)
Noncontrolling interest in consolidated net income
(21,000
)
Consolidated net income attributable to Austin
$
(284,000
)
Additional Information
Annual excess fair over book value amortization of $25,000 resulted from the acquisition.
The parent applies the equity method to this investment.
Austin has 50,000 shares of common stock and 10,000 shares…
Chapter 6 Solutions
Soft Bound Version for Advanced Accounting 13th Edition
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. 15PCh. 6 - Prob. 16PCh. 6 - On January 1, Coldwater Company has a net book...Ch. 6 - Prob. 18PCh. 6 - Prob. 19PCh. 6 - Prob. 20PCh. 6 - On January 1, 2018, Stamford issues 10,000...Ch. 6 - On January 1, 2018, Stamford reacquires 8,000 of...Ch. 6 - Prob. 23PCh. 6 - Prob. 24PCh. 6 - On December 31, 2017. PanTech Company invests...Ch. 6 - Prob. 26PCh. 6 - Prob. 27PCh. 6 - Prob. 28PCh. 6 - Prob. 29PCh. 6 - Prob. 30PCh. 6 - Prob. 31PCh. 6 - Prob. 32PCh. 6 - Prob. 33PCh. 6 - Prob. 34PCh. 6 - Prob. 35PCh. 6 - Alford Company and its 80 percentowned subsidiary,...Ch. 6 - Prob. 37PCh. 6 - Prob. 38PCh. 6 - Prob. 39PCh. 6 - Prob. 40PCh. 6 - Prob. 41PCh. 6 - Prob. 42PCh. 6 - Prob. 43PCh. 6 - Prob. 44PCh. 6 - Fred, Inc., and Herman Corporation formed a...Ch. 6 - Prob. 46PCh. 6 - Prob. 47PCh. 6 - Prob. 48PCh. 6 - Prob. 49PCh. 6 - Prob. 50PCh. 6 - Prob. 1DYSCh. 6 - Prob. 2DYSCh. 6 - The FASB ASC Subtopic Variable Interest Entities...
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