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ACC 410 QUIZ 5 (5)

ACC 410 QUIZ 5 (5)

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Author: Christine Farr
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On January 1 2013, Pounder Company purchased 75% of SludgeSmile Company for $500,000. SludgeSmile Company’s stockholders’ equity on that date was equal to $600,000 and SludgeSmile Company had 60,000 shares issued and outstanding on that date. SludgeSmile Company Corporation sold an additional 15,000 shares of previously unissued stock on December 31, 2013. Assume SludgeSmile Company sold the 15,000 shares to outside interests, Pounder Company’s percent ownership would be:

If a portion of an investment is sold, the value of the shares sold is determined by using the: 

On January 1, 2013, P Corporation purchased 75% of S Corporation for $500,000. S’s stockholders’ equity on that date was equal to $600,000 and S had 40,000 shares issued and outstanding on that date. S Corporation sold an additional 8,000 shares of previously unissued stock on December 31, 2013. Assume S sold the 8,000 shares to outside interests, P’s percent ownership would be:

On January 1 2013, Paulus Company purchased 75% of Sweet Corporation for $500,000. Sweet’ stockholders’ equity on that date was equal to $600,000 and Sweet had 60,000 shares issued and outstanding on that date. Sweet Corporation sold an additional 15,000 shares of previously unissued stock on December 31, 2013. AssumeAssuming that Paulus Company purchased the additional shares, what would be their current percentage ownership on December 31, 2013?

On January 1, 2013, P Corporation purchased 75% of S Corporation for $500,000. S’s stockholders’ equity on that date was equal to $600,000 and S had 40,000 shares issued and outstanding on that date. S Corporation sold an additional 8,000 shares of previously unissued stock on December 31, 2013. Assume that P Corporation purchased the additional shares what would be their current percentage ownership on December 31, 2013?

When the parent company sells a portion of its investment in a subsidiary, the workpaper entry to adjust for the current year’s income sold to noncontrolling stockholders includes a

Under the partial equity method, the workpaper entry that reverses the effect of subsidiary income for the year includes a: 

Which one of the following statements regarding IFRS and accounting for step acquisitions is most correct?

If a parent company acquires additional shares of its subsidiary’s stock directly from the subsidiary for a price less than their book value: 

The computation of noncontrolling interest in net assets is made by multiplying the noncontrolling interest percentage at the

P Corporation purchased an 80% interest in S Corporation on January 1, 2013, at book value for $300,000. S’s net income for 2013 was $90,000 and no dividends were declared. On May 1, 2013, P reduced its interest in S by selling a 20% interest, or one-fourth of its investment for $90,000. What would be the balance in the Investment of S Corporation account on December 31, 2013?

Parr Company owned 24,000 of the 30,000 outstanding common shares of Solomon Company on January 1, 2013. Parr’s shares were purchased at book value when the fair values of Solomon’s assets and liabilities were equal to their book values. The stockholders’ equity of Solomon Company on January 1, 2013, consisted of the following: 

If a subsidiary issues new shares of its stock to noncontrolling stockholders, the book value of the parent’s interest in the subsidiary may

The purchase by a subsidiary of some of its shares from the noncontrolling stockholders results in an increase in the parent’s percentage interest in the subsidiary. The parent company’s share of the subsidiary’s net assets will increase if the shares are purchased:

The purchase by a subsidiary of some of its shares from noncontrolling stockholders results in the parent company’s share of the subsidiary’s net assets

A composition agreement is an agreement between the debtor and its creditors whereby the creditors agree to:

Which of the following items is not a specified priority for unsecured creditors in a bankruptcy petition?

An involuntary petition filed by a firm’s creditors whereby there are twelve or more creditors must be signed by at least:

The duties of the trustee include:

A bankruptcy petition filed by a firm is a:

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