Please do not give solution in image format thanku Pell Company acquires 80% of Demers Company for $500,000 on January 1, 2019. Demers reported common stock of $300,000 and retained earnings of $210,000 on that date. Equipmentwas undervalued by $30,000 and buildings were undervalued by $40,000, each having a 10-year remaining life. Any excess consideration transferred over fair value was attributed togoodwill with an indefinite life. Based on an annual review, goodwill has not been impaired.Demers earns income and pays dividends as follows:2019$100,000NetincomeDividends 40,000Multiple ChoiceO $90,400.Assume the partial equity method is applied.How much does Pell record as Income from Demers for the year ended December 31, 2020?$89,000.$50,400.20212020$120,000$120,000 $130,000$96,000.50,00060,000

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Accounting

How much does Pell record as Income from Demers for the year ended December 31, 2020?

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter16: Accounting Periods And Methods

Section: Chapter Questions

Problem 15DQ

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Pell Company acquires 80% of Demers Company for $500,000 on January 1, 2019. Demers reported common stock of $300,000 and retained earnings of $210,000 on that date. Equipment was undervalued by $30,000 and buildings were undervalued by $40,000, each having a 10-year remaining life. Any excess consideration transferred over fair value was attributed to goodwill with an indefinite life. Based on an annual review, goodwill has not been impaired. Demers earns income and pays dividends as follows: 2019 2020 2021 Net income $ Dividends 100,000 40,000 Multiple Choice $780,000. $660,000. $785,000. $676,000. SO. $ 120,000 50,000 $ 130,000 60,000 Assume the partial equity method is applied. What is the consolidated balance of the Investment in Demers account at December 31, 2021.
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