Harrison Company owns 20,000 of the 50,000 outstandingshares of Taylor, Inc. common stock. During 2015, Taylorearns $1,200,000 and pays cash dividends of $1,000,000. Ifthe beginning balance in the investment account was$625,000. The balance at December 31, 2015, should be

To determine the balance of Harrison Company's investment account in Taylor, Inc. as of December 31,…

Answered: Harrison Company owns 20,000 of the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Harrison Company owns 20,000 of the 50,000 outstanding shares of Taylor, Inc. common stock. During 2015, Taylor earns $1,200,000 and pays cash dividends of $1,000,000. If the beginning balance in the investment account was $625,000. the balance at December 31, 2015, should be A. $1,025,000 B. $825,000 C. $705,000 D. $625,000
Adams Industries holds 40,000 shares of FedEx common stock. On December 31, 2015, and December 31, 2016, the market value of the stock is $95 and $100 per share, respectively. What is the appropriate reporting category for this investment and at what amount will it be reported in the 2016 balance sheet?
Company E reports net income of $100,000 for 2015. Assume the income is earned evenly throughout the year. Dividends of $10,000 are paid on December 31. What will Company R report as investment income under the following ownership situations, if: a. Company R owns a 10% interest from July 1 to December 31? b. Company R owns a 10% interest from January 1 to June 30 and a 25% interest from July 1 to December 31? c. Company R owns a 30% interest from January 1 to June 30 and a 10% interest from July 1 to December 31?
On July 1, 2015, Denver Company purchased 30,000 shares of Eagle Company's 100,000 outstanding ordinary shares for P200 per share. On December 15, 2015, Eagle paid P400,000 in dividends to its share ordinary shareholders. Eagle's net income for the year ended December 31, 2015 was P1,200,000, earned evenly throughout the year. In its 2015 income statement, what amount of income from the investment should Denver report?a. 360,000b. 180,000c. 120,000d. 60,000
On January 1, 2017, Rama Corporation paid $150,000 for 30% of Samer Company's stock. Rama reported a net income of $25,000 in 2017, paid out $10,000 in dividends, and the annual amortization was $1,000 due to the undervaluation of the buildings (F.V> B.V). Rama uses the equity method. What is the balance of investment in Samer Company that will be reported on December 31, 2017? a. $157,500 O b. $153,500 O c. $150,000 d. $153,400
Brown Corporation earns $600,000 and pays cash dividends of $200,000 during 2012. Dexter Corporation owns 3,000 of the 10,000 outstanding shares of Brown. What amount should Dexter show in the investment account at December 31, 2012 if the beginning of the year balance in the account was $800,000? $980,000. $800,000. $920,000. $1,200,000.
How much should be reported in La Casa’s P&L section of the statement of comprehensive income and how much is the carrying value of the investment at the end of 2018?
Assume that Horicon Corp acquired 25% of the common stock of Sheboygan Corp. on January 1, 2015, for $300,000. During 2015, Sheboygan Corp. reported net income of $160,000 and paid total dividends of $60,000. If Horicon uses the equity method to account for its investment, the balance in the investment account on December 31, 2015, will be:
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The December 31, 2018, balance sheet of Whelan, Inc., showed long-term debt of $1,420,000, $144,000 in the common stock account, and $2,690,000 in the additional paid-in surplus account. The December 31, 2019, balance sheet showed long-term debt of $1,620,000, $154,0000 in the common stock account and $2,990,000 in the additional paid-in surplus account. The 2019 income statement showed an interest expense of $96,000 and the company paid out $149,000 in cash dividends during 2019. The firm's net capital spending for 2019 was $1,000,000, and the firm reduced its net working capital investment by $129,000. What was the firm's 2019 operating cash flow, OCF?

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Harrison Company owns 20,000 of the 50,000 outstanding shares of Taylor, Inc. common stock. During 2015, Taylor earns $1,200,000 and pays cash dividends of $1,000,000. If the beginning balance in the investment account was $625,000. The balance at December 31, 2015, should be