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On 1/1/x1, Big acquired 40% of Small for 400,000 when Smalls equity included 500,000 of RE and 500,000 of capital stock. During Year X1, Small
On 1/1/x1, Big acquired 40% of Small for 400,000 when Smalls equity included 500,000 of RE and 500,000 of capital stock. During Year X1, Small reported a 100,000 NI. On 1/2/x2, big purchased an additional 20% of Smalls stock for 250,000. An appraisal of Smalls assets was unable to identify any misvalued assets. During year X2, Small reported a 120,000 NI and paid dividends of 20,000. Based on this information Big should report its investment in small at which of the following amounts on 12/31/X2?
- 720,000
- 732,000
- 750,000
- 762,000
- None of the above
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