Q.35

Watkins, Inc. acquires all of the outstanding stock of Glen Corporation on January 1, 2020. At that date, Glen owns only three assets and has no liabilities Book Yair Value Value Land $ 40,000 $50,000 Equipment (10-year life) 80,000 75,000 Building (20-year life) 200,000 300,000 I Watkins pays $450,000 in cash for Glen, and Glen earns $50,000 in net income and pays $20,000 in dividends during 2020, what amount representing Gion would be reflected in consolidated net income for the year ended December 31, 20207 Multiple Choice $30,000 under the partial equity method O $20,000 under the in tal value method. $44,500 under the equity method If Watkins pays $450,000 in cash for Glen, and Glen carns $50,000 in net income and pay $20,000 in dividends during 2020, what amount representing Glen would be reflected in consolidated net income for the year ended December 31, 2020? 5 Multiple Choice 39 $30,000 under the partial equity method. $20,000 under the initial value method O $44,500 under the equity method $45,500 regardless of the intemal accounting method used $50,000 under the partial equity method