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Adjustments made for consolidation statements not impact the parent general ledger

Select one:

True

False

In the cost method of acquisition, income is recognized only when the subsidiary declares dividends.

Select one:

True

False

On1/1/ 2019,X Co acquired 100% of the common stock of Y Co. At that time, X held lands with a book value of $50,000 and a fair value of $ 130,000; Y held lands with a book value of $25,000 and fair value of $300,000.at what amount would lands be reported in X Co balance sheet prepared immediately after the merger ?

Select one:

a. 430,000

b. 275,000

c. 295,000

d. 350,000

P Co bought 100% of S Co common stock at its book value of $200,000 on1/1 2020. During 2020,S CO reported net income of $65,000 and paid dividends of $20,000.At what amount should P's Income from S be reported on 31/12/2020 by using equity method?

Select one:

a. 65,000

b. 49,500

c. 55,000

d. 50,000

X Co concluded that the fair value of H Co was $40,000 and paid that amount to acquire all of its net assets. H co reported assets with a book value of $30,000 and fair value of $49,000 and liabilities with a book value and fair value of $11,500 on the date of combination. X also paid $1,500 for legal fees related to the acquisition. What amount will be recorded as Investment in H?

Select one:

a. 40,000

b. 41,500

c. 39,500

d. 38,500

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