On January 1, 2021 ABC purchased 80% of the outstanding shares of DEF at a cost of $960,000. On that date, DEF had $600,000 worth of outstanding shares and $60,000 worth of accumulated profits. For 2021, ABC had income of $336,000 from its own operations and paid dividends of $180,000. For 2021, DEF reported income of $64,000 and paid dividends of $36,000. All of the assets and liabilities of DEF have book values equal to their market value. On January 1, 2021, ABC sold equipment to DEF for $120,000. The book value of the equipment on that was $144,000. The loss of $24,000 is reflected in the net income of indicated above. The equipment is expected to have a useful life of five years from the date of the sale. In the December 31, 2021 consolidated statement of financial position, the non- controlling interest in net assets of Subsidiary should be presented at O 284,400 O 240,000 O 245,600 O 255,600

On January 1, 2021 ABC purchased 80% of the outstanding shares of DEF at a cost of $960,000. On that date, DEF had $600,000 worth of outstanding shares and $60,000 worth of accumulated profits. For 2021, ABC had income of $336,000 from its own operations and paid dividends of $180,000. For 2021, DEF reported income of $64,000 and paid dividends of $36,000. All of the assets and liabilities of DEF have book values equal to their market value. On January 1, 2021, ABC sold equipment to DEF for $120,000. The book value of the equipment on that was $144,000. The loss of $24,000 is reflected in the net income of indicated above. The equipment is expected to have a useful life of five years from the date of the sale. In the December 31, 2021 consolidated statement of financial position, the non- controlling interest in net assets of Subsidiary should be presented at O 284,400 O 240,000 O 245,600 O 255,600

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 25E

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