Assume that, on January 1, 2021, Sacramento Corporation paid $1,622,400 for its investment in 62,400 shares of Angel Company. Further, assume that Angel has 260,000 total shares of stock issued. The book value and fair value of Angel's identifiable net assets were both $520,000 at January 1, 2021. The following information pertains to Angel during 2021: Net income $260,000 Dividends declared and paid $ 78,000 Market price of common stock on 12/31/2021 $ 28/share What amount would Sacramento report in its year-end 2021 balance sheet for its investment in Angel? Multiple Choice $1,666,080. $1,960,400. $1,804,400. None of these answer choices are correct.

Assume that, on January 1, 2021, Sacramento Corporation paid $1,622,400 for its investment in 62,400 shares of Angel Company. Further, assume that Angel has 260,000 total shares of stock issued. The book value and fair value of Angel's identifiable net assets were both $520,000 at January 1, 2021. The following information pertains to Angel during 2021: Net income $260,000 Dividends declared and paid $ 78,000 Market price of common stock on 12/31/2021 $ 28/share What amount would Sacramento report in its year-end 2021 balance sheet for its investment in Angel? Multiple Choice $1,666,080. $1,960,400. $1,804,400. None of these answer choices are correct.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: For the year ended December 31, 2021, Norstar Industries reported net income of $910,000. At January…

A: given that, net income for the year December 31, 2021, = $910000. opening outstanding common shares…

Q: Novak Corporation's December 31, 2025, trial balance includes the following accounts: Investment in…

A: The Stockholders' Equity section, also known as Shareholders' Equity or Owners' Equity, is a section…

Q: The following balances were taken from the records of Sheridan Company: Common stock (1/1/20 and…

A: Consolidation is an activity in which financial statements of a parent and its subsidiary should be…

Q: Carla Vista Pine Co. provided the following information on selected transactions during 2021:…

A: Cash flow from investing activity includes transactions like the purchase and sale of long-term…

Q: On jan. 1, 2019, Bacardi Limited had retained earnings of $8,000,000. During 2019, the corporation…

A: Retained earnings are the free reserves that are attributable to the owners of the entity. Profits…

Q: The December 31, 2021, balance sheet of Chen, Incorporated, showed long-term debt of $1,435,000,…

A: An organization is typically doing well if its core operations are producing more cash than it is…

Q: On January 1, 2024, Lawn Corporation had 87,000 common shares, recorded at $626,400, and retained…

A: The dividend is declared to the shareholders from the retained earnings of the business. The…

Q: On January 1, 2021, MNO Company acquired 12,500 of the outstanding common shares of Esther…

A: The portion of the dividend is based on the portion of holdings. The holding can be calculated by…

Q: pr. 1 Purchased 7% MRT bonds at face value, for $56,000. Paver received interest from these bonds…

A: PAVER FINANCIAL CORPORATION Statement of Income (Partial) For the year ended Dec 31, 2021…

Q: The December 31, 2018, balance sheet of Whelan, Inc, showed long-term debt of $1,385,000, $137.000…

A: Computation of new net borrowing: New net borrowing = Long term debt of 2019 - Long term debt 2018…

Q: Blue Spruce Limited reported profit of $436,010 for its November 30, 2021, year end. Cash dividends…

A: Profit available to common share holders= Net profit- Preference dividend = 436010-69500 = 366510

Q: Cullumber Rental Corporation had the following balances in its shareholders' equity accounts at…

A: Journal entries refer to recording and classyfing business transactions into books of accounts…

Q: On January 1, 2024, Accustart Corporation had 84,000 common shares, recorded at $659,400, and…

A: The dividend is declared to the shareholders from the retained earnings of the business. The stock…

Q: Information from the financial statements of Henderson-Niles Industries included the following at…

A: Introduction EPS - Earnings Per Share is the Portion of profit per share. Convertible securities are…

Q: For the year ended December 31, 2021, Norstar Industries reported net income of $975,000. At January…

A: Sure, let's break down the calculations and explanations for each section of the Form 1120-S and…

Q: Wheaton Inc. had the following balances as of December 31, 2021: -Contributed surplus- common share…

A: Shareholder's Equity: Shareholders' equity (also known as corporate net worth) is a measure of how…

Q: Denver Co. owns 29,000 shares of common stock of Aspen Co. as an investment. The balance of this…

A: To account for Denver Co.'s investment in Aspen Co. stock during 2023, we need to consider the…

Q: Shown below in T-account format are the changes affecting the retained earnings of Brenner-Jude…

A: Journal Entry is the primary step to record the transaction in the books of accounts. The increase…

Q: 2. Calculate the carrying value per share of Heritage's investment as reflected in the investment…

A: If an investor holds at least 20 percent of the voting power of an investee, the investor is…

Q: The equity section from the December 31, 2020 and 2021, balance sheets of Westburne Corporation…

A: The dividend is declared to the shareholders from the retained earnings of the business. The…

Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

Assume that, on January 1, 2021, Sacramento Corporation paid $1,622,400 for its investment in 62,400 shares of Angel Company. Further, assume that
Angel has 260,000 total shares of stock issued. The book value and fair value of Angel's identifiable net assets were both $520,000 at January 1, 2021.
The following information pertains to Angel during 2021:
Net income
$260,000
Dividends declared and paid
$ 78,000
$
Market price of common stock on 12/31/2021
28/share
What amount would Sacramento report in its year-end 2021 balance sheet for its investment in Angel?
Multiple Choice
$1,666,080.
$1,960,400.
$1,804,400.
None of these answer choices are correct.
< Prev
7 of 16
Next >

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

On January 1, 2020, Leilanie Company reported the following shareholders' equity: Share capital 1,500,000 Share premium 3,000,000 Retained earnings 5,000,000 The entity had 400,000 authorised shares of P5 par value, of which 300,000 shares were issued and outstanding. On March 1, the entity acquired 50,000 shares for P10 per share to be held as treasury. On July 1, the entity declared a property dividend of inventory payable on July 31. The inventory had a P1,200,000 carrying amount anda fair value of P1,500,000 on July 1 The net income for 2020 was P3,000,000. How much is the appropriated retained earnings? Select the correct response O500,000 O 400.000 O 250,000 O 450,000 < Previous Continue
Please answer in good accounting form. Thankyou What is the retained earnings balance ending December 31, 2021?
Oriole Corporation was organized on January 1, 2021. During its first year, the corporation issued 1,950 shares of $50 par value preferred stock and 105,000 shares of $10 par value common stock. At December 31, the company declared the following cash dividends: 2021, $5,000; 2022, $13,900; and 2023, $27,000.
For the year ended December 31, 2021, Norstar Industries reported net income of $655,000. At January 1, 2021, the company had 900,000 common shares outstanding. The following changes in the number of shares occurred during 2021: Apr. 30 Sold 60,000 shares in a public offeringMay 24 Declared and distributed a 5% stock dividendJune 1 Issued 72,000 shares as part of the consideration for the purchase of assets from a subsidiary Required:Compute Norstar’s earnings per share for the year ended December 31, 2021.
Shown below in T-account format are the changes affecting the retained earnings of Brenner-Jude Corporation during 2021. At January 1, 2021, the corporation had outstanding 107 million common shares, $1 par per share. Retained Earnings ($ in millions) 109 Beginning balance Retirement of 7 million common shares for $38 million 2 98 Net income for the year Declaration and payment of a $0.35 per share cash dividend 35 Declaration and distribution of a6% stock dividend 25 145 Ending balance Required:1. From the information provided by the account changes, you should be able to recreate the transactions that affected Brenner-Jude’s retained earnings during 2021. Prepare the journal entries that Brenner-Jude must have recorded during the year for these transactions. (Hint: In lieu of revenues and expenses, use an account titled “Income summary” to close net income or net loss.)2. Prepare a statement of retained earnings for Brenner-Jude for the…
Sunland Rental Corporation had the following balances in its shareholders' equity accounts at January 1, 2021: Accumulated other comprehensive income (loss) Contributed surplus-reacquisition of common shares Retained earnings Common shares (25,000 shares) Feb. 2 Sunland had the following transactions and events during 2021: Apr. 17 Oct. 29 $ (26,000) Dec. 31 559,000 1,600,000 625.000 Repurchased 1.200 shares for $57,600. Declared and paid cash dividends of $71,000. Issued 1,900 shares for $106,000 cash. Reported comprehensive income of $415,000, which included other comprehensive income of $31.000.
The Gangnam Company began operations in January 2019 and reported the following results for each of its three years of operations. 2019 – P520,000 loss; 2020 – P80,000 loss; 2021 – P1,600,000 profit At December 31, 2020, Gangnam Company’s capital accounts were as follows: 8% Cumulative Preference Share Capital, P100 par, 50,000 shares authorized, issued and outstanding- P5,000,000; Ordinary Share Capital, P10 par, 1,000,000 shares authorized, 750,000 shares issued and outstanding- P7,500,000 Gangnam Company has never paid a cash or bonus issue and there has been no change in its capital accounts since it began operations in 2019. The corporation law permits dividends only from retained earnings.What is the book value of the ordinary share at December 31, 2020 assuming that the preference share has a liquidating value of P106 per share?
The December 31, 2021, balance sheet of Chen, Incorporated, showed long-term debt of $1,460,000, $152,000 in the common stock account, and $2,770,000 in the additional paid-in surplus account. The December 31, 2022, balance sheet showed long-term debt of $1,700,000, $162,000 in the common stock account and $3,070,000 in the additional paid-in surplus account. The 2022 income statement showed an interest expense of $100,000 and the company paid out $157,000 in cash dividends during 2022. The firm's net capital spending for 2022 was $1,080,000, and the firm reduced its net working capital investment by $137,000. What was the firm's 2022 operating cash flow, or OCF? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. Operating cash flow Prev 9 of 10 ▬▬▬ ‒‒‒ Next >
Pluto Company began operations on January 1, 2019 with an authorized capital of 500,000 preference shares of P5 par value of which 30% of which was issued for P7 and 950,000 ordinary shares of P10 par value of which half were issued on January 1, 2019 at P15 per share. During the year, the company had a net income of P1,250,000 and declared dividends of P250,000. The following were the transactions in 2020: a. Issued 100,000 ordinary shares for P17 b. Issued 150,000 preference shares for P8 per share. c. Authorized the purchase of a custom made machine to be delivered in January 2021. Pluto Company appropriated P300,000 of accumulated profits for the purchase of the machine. d. Issued additional 50,000 preference shares for P9 per share, e. Net income for the year, P1,200,000. Dividends of P600,000 were declared for 2020 to shareholders of record on January 15, 2021 to be paid on March 15, 2021 per share. What is the total contributed capital as of December 31, 20207
C. Reither Co. reports the following information for 2025: sales revenue $700,000 cost of goodssold $500,000, operating expenses $80,000, and an unreliazed holding loss on available-for-sale debt securities of 2025 of $60,000. It declared and paid a cash dividend of $10,000 in 2025. C. Reither Co. has Janaury 1, 2025, balances in common stock $350,000; accumulated other comprehensive income $80,000; and retained earnings $90,000. It issued no stock during 2025. Prepare a statement of stockholders' equity. (Ignore income taxes).
For the year ended December 31, 2021, Norstar Industries reported net income of $990,000. At January 1, 2021, the company had 1,170,000 common shares outstanding. The following changes in the number of shares occurred during 2021: Apr. 30 Sold 110,000 shares in a public offering. May 24 Declared and distributed a 5% stock dividend. June 1 Issued 126,000 shares as part of the consideration for the purchase of assets from a subsidiary. Required: Compute Norstar's earnings per share for the year ended December 31, 2021. (Enter your answers in thousands. Round "EPS" answer to 2 decimal places. Do not round intermediate calculations.) Numerator / Denominator / Earnings per Share
Selected information from the accounts of Arch Inc. on December 31, 2021 reveals that the total income since incorporation is $42,000; the total cash dividends paid is $13,000; the total value of property dividends distributed is $3,000; and the excess of proceeds over cost of treasury shares sold is $11,000. In its December 31, 2021 statement of changes in equity, what amount should the firm report as accumulated profits (retained earnings)?