Question
Please show all work! Davis acquires 100% of ramos on january 1, 2009. ramos will be operated as a separate subsidiary. Davis will use the
Please show all work!
Davis acquires 100% of ramos on january 1, 2009. ramos will be operated as a separate subsidiary. Davis will use the equity method to account for its investment in ramos. In 2013, davis has net income of 400,000 and pays dividends of 100,000. ramos has net income of 200,000 and pays dividends of 75,000. at acqusition date, davis has a building with a book value of 3,000,000 and a fair value of 4,000,000. at that date, ramos had a building with a book value of 800,000 and fair value of 900,000. both buildings have a remaining useful life of 10 years (assume straight line depreciation).
At December 31, 2013 Davis had book value (BV) of Building of 5,000,000 and fair value (FV) of 6,000,000. Ramos had BV of Building of 2,000,000 and FV of 1,500,000.
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prepare worksheet entry a at december 31, 2013 (assume there is no goodwill).
d. how much is consolidated buildings at december 31, 2013
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