Goldman Company reports net income of $ 140,000 each year and pays an annual cash dividend of
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Goldman Company reports net income of $ 140,000 each year and pays an annual cash dividend of $50,000. The company holds net assets of $1,200,000 on January 1, 2008. On that date, Wallace purchases 40 percent of the outstanding stock for $600,000, which gives it the ability to signifi¬ cantly influence Goldman. At the purchase date, the excess of Wallace’s cost over its proportionate share of Goldman’s book value was assigned to goodwill. On December 31, 2010, what is the Investment in Goldman Company balance (equity method) in Wallace’s financial records?
a. $600,000.
b. $660,000.
c. $690,000.
d. $708,000.
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Related Book For
Advanced Accounting
ISBN: 9780073379456
9th Edition
Authors: Joe Ben Hoyle, Timothy S. Doupnik, Thomas F. Schaefer, Oe Ben Hoyle
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