Answer Question:Parent Co. invested $1,070,000 in Sub Co. for 25% of itsoutstanding stock. Sub Co. pays out 40% of net income individends each year. Use the information in the following T-account for the investment in Sub to answer the followingquestions.Investment in Sub Co.1,070,000130,00052,000(a) How much was Parent Co.'s share of Sub Co.'s net incomefor the year?(b) How much was Parent Co.'s share of Sub Co.'s dividendsfor the year?(c) What was Sub Co.'s total net income for the year?(d) What was Sub Co.'s total dividends for the year?

Calculating Equity Held in Investments & Dividends ReceivedA company (say company A) may make…

Answered: Question: Parent Co. invested…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 11MCQ

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Pronghorn Co. invested $1,070,000 in Stellar Co. for 25% of its outstanding stock. Stellar Co. pays out 30% of net income in dividene each year. Use the information in the following T-account for the investment in Stellar to answer the following questions. Investment in Stellar Co. 1,070,000 99,000 (a) How much was Pronghorn Co.'s share of Stellar Co's net income for the year? Net income 29,700 Total net income (b) What was Stellar Co's total net income for the year? 428000 Total Dividends. $ 396000 (c) What was Stellar Co's total dividends for the year? 128400
Parent Co. invested $1,000,000 in Sub Co. for 25% of its outstanding stock. Sub Co. pays out 40% of net income in dividends each year. Instructions Use the information in the following T-account for the investment in Sub to answer the following questions. Investment in Sub Co. 1,000,000 110,000 44,000 a. How much was Parent Co.'s share of Sub Co.'s net income for the year? b. What was Sub Co.'s total net income for the year? c. What was Sub Co.'s total dividends for the year? d. How much was Parent Co.'s share of Sub Co.'s dividends for the year?
Grouper Co. invested $1,060,000 in Monty Co. for 25% of its outstanding stock. Monty Co. pays out 30% of net income in dividends each year.Use the information in the following T-account for the investment in Monty to answer the following questions. Investment in Monty Co. 1,060,000 121,000 36,300 (a) How much was Grouper Co.’s share of Monty Co.’s net income for the year? Net income $enter Grouper’s net income in dollars (b) What was Monty Co.’s total net income for the year? Total net income $enter the total net income of MontyCo. for the year (c) What was Monty Co.’s total dividends for the year? Total Dividends $enter the total dividends of MontyCo. for the year (d) How much was Grouper Co.’s share of Monty Co.’s dividends for the year? Dividends $enter the dollar amount of dividends for Grouper Co.
Fairbanks Corporation purchased 400 ordinary shares of Sherman Inc. as a trading investment for E13,200. During the year, Sherman paid a cash dividend of £3.25 per share. At year-end, Sherman shares were selling for £34.50 per share. How much total revenues (all revenues) should be recognized from this investment during the year? Select one: Oa. $1900 Ob. $700 OC $1300 Od. $600
Bonita Co. invested $910,000 in Windsor Co. for 25% of its outstanding stock. Windsor Co. pays out 30% of net income in dividends each year.Use the information in the following T-account for the investment in Windsor to answer the following questions. Investment in Windsor Co. 910,000 99,000 29,700 (a) How much was Bonita Co.’s share of Windsor Co.’s net income for the year? Net income $enter Bonita’s net income in dollars (b) What was Windsor Co.’s total net income for the year? Total net income $enter the total net income of WindsorCo. for the year (c) What was Windsor Co.’s total dividends for the year? Total Dividends $enter the total dividends of WindsorCo. for the year (d) How much was Bonita Co.’s share of Windsor Co.’s dividends for the year? Dividends $enter the dollar amount of dividends for Bonita Co.
Company A acquired 37% investment in Company B for R196 000. During the first year after acquieition Company B made net income of R400 000. Using the equity accounting method, what will happen to Company A's investment in Company B? Select one: O a. It remains the same O b. It increases by R148 000 O c Ilt decreases by R196 000 O d. It decreases by R148 000
year. investment g amount of P8,000,000. ahares of Beta Company an Beta' Company had 80,000 amount and fair valus of 3 600,000 and P3,900,000 mid per-share dividend of . Compute the carrying amount of the investment at year-end. aount of the Problem 17-7 (ACP) On January 1, 2016, Bypass Company acquired as n long term investment for P7,000,000 a 40% interent in an investee when the fair value of the net'assets was P17,500,000. The investee reported the following net losses: broadcas 2016 2017 2018 2019 5,000,000 7,000,000 8,000,000 4,000,000 attributable to a On January 1, 2018, Bypass Company made cash advances of P2,000,000 to the investee. On December 31, 2019, it is not expected that Bypass Company will provide further financial support for the investee. Company has a 20-year broadcast license. 019. 20. he investment in Required: Prepare journal entries from 2016 to 2019 in relation to the investment in associate.
Jackson Moving & Storage Co. paid $120,000 for 25% of the common stock ofMcDonough Co. at the beginning of the year. During the year, McDonough earned netincome of $50,000 and paid dividends of $20,000. The carrying value of Jackson’s investment in McDonough at the end of the year isa. $150,000.b. $170,000.c. $120,000.d. $127,500.
Current Attempt in Progress Kingbird Co. invested $990,000 in Oriole Co. for 25% of its outstanding stock. Oriole Co. pays out 40% of net income in dividends each year. Use the information in the following T-account for the investment in Oriole to answer the following questions. Investment in Oriole Co. 990,000 117,000 (a) How much was Kingbird Co.'s share of Oriole Co's net income for the year? Net income 46,800 (b) What was Oriole Co's total net income for the year? Total net income $ (c) What was Oriole Co's total dividends for the year? Total Dividends $ (d) How much was Kingbird Co's share of Oriole Co's dividends for the year? Dividends $
A corporation using the cost method of accounting for its investment in a 80%–owned investee, which earned $20,000 and paid $5,000 in dividends What is the ending balance of investment on 31/12 if investment in 1/1 amount 100,000$ ? Select one: a. 120,000 b. 100,000 c. 115,000 d. 112,000
What amount should be recorded as investment income for Hannah Company owned 20% of Love Company's preference share capital and 50% of the ordinary share capital. do-T-Valix-2-pdf.pdf Love Company's share capital outstanding comprised the following at year-end: 10% cumulative preference share capital Ordinary share capital 2,000,000 7,000,000 Love Company reported net income of P5,000,000 for the current year. What amount should be recorded as investment income 10 the current year? a. 2,400,000 b. 2,500,000 c. 2,600,000 d. 2,700,000 490
Fill in the dollar changes caused in the Investment account and Dividend Revenue or Investment Revenue account by each of the following transactions, assuming Nash's Company uses (a) the fair value method and (b) the equity method for accounting for its investments in Swifty Company. 1. At the beginning of Year 1, Nash's bought 30% of Swifty's common stock at its book value. Total book value of all Swifty's common stock was $720,000 on this date. 2. (a) During Year 1, Swifty reported $50,000 of net income. (b) During Year 1, Swifty paid $28,000 of dividends. 3. (a) During Year 2, Swifty reported $25,000 of net income. (b) During Year 2, Swifty paid $18,000 of dividends. 4. (a) During Year 3, Swifty reported a net loss of $8,000. (b) During Year 3, Swifty paid $3,500 of dividends. 5. Indicate the Year 3 ending balance in the Investment account, and cumulative totals for Years 1, 2, and 3 for dividend revenue and investment revenue.

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