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On January 1, 20X1, Davidson Company acquired 100 percent of Laura Company for $900,000 when Laura's book value was $700,000. At the acquisition date, Laura's building (20-year remaining life) was undervalued in its financial records by $120,000. Also, patented technology (5-year remaining life) was undervalued by $80,000. At the end of 20X1, Davidson reports building of $640,000 while Laura reports building of $280,000. What amount is reported for building in the 20X1 consolidated balance sheet? O $920,000. O $984,000. O $1,042,000. O $1,034,000.

On January 1, 20X1, Davidson Company acquired 100 percent of Laura Company for $900,000 when Laura's book value was $700,000. At the acquisition date, Laura's building (20-year remaining life) was undervalued in its financial records by $120,000. Also, patented technology (5-year remaining life) was undervalued by $80,000. At the end of 20X1, Davidson reports building of $640,000 while Laura reports building of $280,000. What amount is reported for building in the 20X1 consolidated balance sheet? O $920,000. O $984,000. O $1,042,000. O $1,034,000.

FINANCIAL ACCOUNTING
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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On January 1, 20X1, Davidson Company acquired 100 percent of Laura Company for $900,000 when Laura's book value was $700,000. At the acquisition date, Laura's building (20-year remaining life) was undervalued in its financial records by $120,000. Also, patented technology (5-year remaining life) was undervalued by $80,000. At the end of 20X1, Davidson reports building of $640,000 while Laura reports building of $280,000. What amount is reported for building in the 20X1 consolidated balance sheet? O $920,000. O $984,000. O $1,042,000. O $1,034,000.
Transcribed Image Text:On January 1, 20X1, Davidson Company acquired 100 percent of Laura Company for $900,000 when Laura's book value was $700,000. At the acquisition date, Laura's building (20-year remaining life) was undervalued in its financial records by $120,000. Also, patented technology (5-year remaining life) was undervalued by $80,000. At the end of 20X1, Davidson reports building of $640,000 while Laura reports building of $280,000. What amount is reported for building in the 20X1 consolidated balance sheet? O $920,000. O $984,000. O $1,042,000. O $1,034,000.
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