Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

how i do this Matthew incorporated, owns 30 percent of the outstanding stock of Lindman Company and has the ability to significantly influence the imvestee's

how i do this
image text in transcribed
Matthew incorporated, owns 30 percent of the outstanding stock of Lindman Company and has the ability to significantly influence the imvestee's operations and decision making On January 1,2024, the balance in the Investment in Lindman account is $335,000 Amortization associated with this acquistion is $9.000 per year. in 2024 , Lindman earns an income of $90,000 and declares cash dividends of $30,000. Previously, in 2023, Lindman had sold inventory costing $24,000 to Matthew for $40.000. Matthew consurned all but 25 percent of this merchandise during 2023 and used the rest during 2024 . Lindman sold additional inventory costing $28,000 to Matthew for $50.000 in 2024 . Matthew did not consume 40 percent of these 2024 purchases from Lindman until 2025 Required: a. What amount of equity method income would Matthew recognize in 2024 from its ownership interest in Lindman? b. What is the equity method bolance in the Investment in Lindman occount at the end of 2024

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Audit And Assurance Q And A 2016

Authors: ACA Simplified

1st Edition

1523200464, 978-1523200467

More Books

Students also viewed these Accounting questions

Question

6. Are my sources reliable?

Answered: 1 week ago

Question

5. Are my sources compelling?

Answered: 1 week ago