Question
I just need the answers. No explanation is needed. Thank you in advance. 15. Which of the following situations is viewed as the parent having
I just need the answers. No explanation is needed. Thank you in advance.
15. Which of the following situations is viewed as the parent having treasury stock?
a. A owns 80% of B and 20% of C; B owns 70% of C.
b. A owns 80% of B, and B owns 20% of A.
c. A owns 80% of B, and B owns 70% of C.
d. None of the above.
16. Plum Inc. acquired 90% of the capital stock of Sterling Co. on 1/1/X1 at a cost of $540,000. On this date Sterling had equipment (10-year life) carried at $200,000 under market and total equity amounting to $350,000.
On 1/1/X1 Sterling acquired 5% (10,000 shares) of Plums outstanding common stock for $3 per share. Internally generated net income was $50,000 for Plum and $40,000 for Sterling.
Consolidated net income for 20X2 is
a. $86,000
b. $90,000
c. $83,500
d. $70,000
17. Company P had 300,000 shares of common stock outstanding. It owned 80% of the outstanding common stock of S. S owned 20,000 shares of P common stock. In the consolidated balance sheet, Company P's outstanding common stock may be shown as
a. 300,000 shares, footnoted to indicate that S holds 20,000 shares.
b. 300,000 shares
c. 300,000 shares, less 20,000 shares of treasury stock.
d. 285,000 shares
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