Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. problems 20 through 22 are based on the following

Problems 20 through 22 are based on the following information. Neill Company purchases 80 percent...

60.1K

Verified Solution

Question

Accounting

image

Problems 20 through 22 are based on the following information. Neill Company purchases 80 percent of the common stock of Stamford Company on January 1, 2017, when Stamford has the following stockholders' equity accounts Common stock-40,000 shares outstanding $100,000 75,000 Total stockholders' equity $715,000 To acquire this interest in Stamford, Neill pays a total of $592,000. The acquisition-date fair value of the 20 percent noncontrolling interest was $148,000. Any excess fair value was allocated to goodwill, which has not experienced any impairment. On January 1, 2018, Stamford reports retained earnings of $620,000. Neill has accrued the increase in Stamford's retained earnings through application of the equity method. View the following problems as independent situations: On January 1, 2018, Stamford issues 10,000 additional shares of common stock for $25 per share. Neill acquires 8,000 of these shares. How will this transaction affect the parent company's Additional Paid-In Capital account? a. Has no effect on it. b. Increases it by $20,500. c. Increases it by $36,400. d. Increases it by $82,300

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Compare and contrast the fundamental differences in tax characteristics across different entity types.

Finance
Q

We are engaged in cultural studies, our task is not merely to take the history lessons...

Psychology
Q

Interest groups are an important part of the policymaking process in the United States. Define an...

Psychology
Q

As your company's director of human relations, you have to deal with Susan's complaint about her...

General Management
Q

The major effect of genetic drift is O no change in population size but an...

Biology
Q

A burn that goes completely through the epidermis but only partway through the dermis would...

Biology
Q

18 There are 1 5 mg of iron in 8 ounces of apple juice If...

Basic Math
Q

Part I (2 points) The following is the output from R code. Please clearly state...

Accounting
Q

Selected account information (in $ millions) from Target Corporations 2011 annual report follows. While the...

Accounting
Q

Strickland Industries compr una participacin del 30% en Spartan, Inc. por $600,000. espartano, inc. ...

Accounting
Q

Bal Corp. declared a $25,000 cash dividend on May 8, which was distributed on June...

Accounting
Q

For a company whose target capital structure calls for 50% debt and 50% common equity,...

Finance