On January 1, 2021, Cameron Inc. bought 20% of the outstanding common stock of Lake Construction Company for $360 million cash, giving Cameron the ability to exercise significant influence over Lake's operations. At the date of acquisition of the stock, Lake's net assets had a fair value of $800 million. Its book value was $700 million. The difference was attributable to the fair value of Lake's buildings and its land exceeding book value, each accounting for one-half of the difference. Lake's net income for the year ended December 31, 2021, was $180 million. During 2021, Lake declared and paid cash dividends of $25 million. The buildings have a remaining life of 10 years. Required: 2. Determine the amounts to be reported by Cameron

On January 1, 2021, Cameron Inc. bought 20% of the outstanding common stock of Lake Construction Company for $360 million cash, giving Cameron the ability to exercise significant influence over Lake's operations. At the date of acquisition of the stock, Lake's net assets had a fair value of $800 million. Its book value was $700 million. The difference was attributable to the fair value of Lake's buildings and its land exceeding book value, each accounting for one-half of the difference. Lake's net income for the year ended December 31, 2021, was $180 million. During 2021, Lake declared and paid cash dividends of $25 million. The buildings have a remaining life of 10 years. Required: 2. Determine the amounts to be reported by Cameron

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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