Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. question 2(10 points) va - when puff acquired 85

Question 2(10 points) VA - When Puff acquired 85% of Smoke on January...

70.2K

Verified Solution

Question

Accounting

Question 2(10 points)
VA - When Puff acquired 85% of Smoke on January 1, Year 1 for $238,000, the
imputed acquisition differential of $60,000 was allocated entirely to goodwill. On
December 31, Year 1, a goodwill impairment loss of $1,500 was recognized. Puff
uses the cost method to account for its investment in Smoke. Puff reported separate
entity net income in Year 1 of $25,000 and declared no dividends. Smoke recorded
separate entity net income of $40,000 and paid dividends of $9,000 in year 1.
Required: Compute the following
a. Consolidated net income for year 1
(4 marks)
b. Income allocated to NCl for year 1.
(2 marks)
c. Investment in Smoke at December 31, Year 1 assuming Puff used the equity
method to account for its investment in Smoke.
(4 marks)
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Electrical Engineering
1.2K views

1. Given a parallel circuit with a constant current source containing resistors of different values, which...

Biology
1.2K views

The role of DNApolymerase I is Remove RNA primers and add DNA in its place...

Biology
1.2K views

considered a an O Effector Receptor Variable O Stimulus Question 2 The eyes are O...

Physics
1.2K views

of the following are correct a For a general rotational motion angular momentum L and...

Basic Math
1.2K views

1 Statistical Inferences Question 10 Which distribution shown here has the LARGEST standard deviation Select...

Basic Math
1.2K views

The graph of y f x is shown below 7 6 5 4 3

Statistics
1.2K views

6 2 Negative z scores 0 00 0 01 0 02 0 03 0 04...

Calculus
1.2K views

Find the derivative of the function.f(x) = sin(6

Algebra
1.2K views

A broker has 15 sales agents in her firm Sales agent 1 procures an exclusive...

Accounting
1.2K views

Question 1: Hilary Corp. contracted with a company to build a storage warehouse...

Accounting
1.2K views

Tim and Martha paid $7,9000 in qualified employment-relates expenses for their htree young children who...

Accounting
1.2K views

Tri-State Bank and trust is considering giving Sheridan Company a loan. Before doing so, management...