Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Acker Inc. bought 40% of Howell Co. on January 1, 2020 for $576,000. The equity method of accounting was used. The book value and fair
Acker Inc. bought 40% of Howell Co. on January 1, 2020 for $576,000. The equity method of accounting was used. The book value and fair value of the net assets of Howell on that date were $1,440,000. Acker began supplying inventory to Howell as follows: Year 2020 2021 Cost to Acker $55,000 $70,000 Transfer Price $ 75,000 $110,000 Amount Held by Howell at Year- End $15,000 $55,000 Howell reported net income of $100,000 in 2020 and $120,000 in 2021 while paying $40,000 in dividends each year. What is the balance in Acker's Investment in Howell account at December 31, 2021? Multiple Choice $656,000. $666,000. o $646.000 O $636,000. O O $624,000
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started