quipment $10,000 Goodwill $35,000 $45,000 Equipment was expected to last five more years from date of acquisition and is still owned at year end. Goodwill was written down by $5,000 in 2018. In 2019, Premier sold JV land, reporting a gain of $20,000. JV still has the land. In 2019, JV sold Premier inventory for $30,000 reporting a profit of $6,000. $15,000 of the inventory was still held by Premier at the end of 2019 and sold early in 2020. In 2020, JV reported net income of $35,000 and declared and paid total dividends of $15,000. At December 31, 2020, JV had retained earnings of $160,000. Premier uses the equity method to record the investment in JV. Tax rate is 25%. Calculate the equity method income related to JV for 2020 reported by Premie
quipment $10,000 Goodwill $35,000 $45,000 Equipment was expected to last five more years from date of acquisition and is still owned at year end. Goodwill was written down by $5,000 in 2018. In 2019, Premier sold JV land, reporting a gain of $20,000. JV still has the land. In 2019, JV sold Premier inventory for $30,000 reporting a profit of $6,000. $15,000 of the inventory was still held by Premier at the end of 2019 and sold early in 2020. In 2020, JV reported net income of $35,000 and declared and paid total dividends of $15,000. At December 31, 2020, JV had retained earnings of $160,000. Premier uses the equity method to record the investment in JV. Tax rate is 25%. Calculate the equity method income related to JV for 2020 reported by Premie
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
| Equipment | $10,000 |
| |
$35,000 |
| $45,000 |
| Equipment was expected to last five more years from date of acquisition and is still owned at year end. | ||
| Goodwill was written down by $5,000 in 2018. |
| In 2019, Premier sold JV land, reporting a gain of $20,000. JV still has the land. In 2019, JV sold Premier inventory for $30,000 reporting a profit of $6,000. $15,000 of the inventory was still held by Premier at the end of 2019 and sold early in 2020. |
| In 2020, JV reported net income of $35,000 and declared and paid total dividends of $15,000. At December 31, 2020, JV had |
| Premier uses the equity method to record the investment in JV. Tax rate is 25%. |
Calculate the equity method income related to JV for 2020 reported by Premier.
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