Balance Sheet and Net Income Essay

1272 Words Dec 3rd, 2013 6 Pages
On January 4, 2010, Harley, Inc. acquired 40% of the outstanding common stock of Bike Co. for $2,400,000. This investment gave Harley the ability to exercise significant influence over Bike. Bike's assets on that date were recorded at $10,500,000 with liabilities of $4,500,000. There were no other differences between book and fair values. During 2010, Bike reported net income of $500,000. For 2011, Bike reported net income of $800,000. Dividends of $300,000 were paid in each of these two years. 49. How much income did Harley report from Bike for 2010? 
A. $120,000.
B. $200,000.
C. $300,000.
D. $320,000.
E. $500,000.

26. Under the equity method, when the company's share of cumulative losses equals its investment and the company has no
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On January 1, 2011, Dalton sold this building to Shrugs for $392,000. At that time, the building had a remaining life of eight years but still no expected salvage value. In preparing financial statements for 2011, how does this transfer affect the calculation of Daltons share of consolidated net income?
A. Consolidated net income must be reduced by $44,800.
B. Consolidated net income must be reduced by $50,400.
C. Consolidated net income must be reduced by $49,000.
D. Consolidated net income must be reduced by $56,000.
E. Consolidated net income must be reduced by $34,300.
8. How would consolidated earnings per share be calculated if the subsidiary has no convertible securities or warrants?

A. Parent's earnings per share plus subsidiary's earnings per share
B. Parent's net income divided by parent's number of shares outstanding
C. Consolidated net income divided by parent's number of shares outstanding
D.Average of parent's earnings per share and subsidiary's earnings per share
E.Consolidated income divided by total number of shares outstanding for the parent and subsidiary

Campbell Inc. owned all of Gordon Corp. For 2014, Campbell reported net income (without consideration of its investment in Gordon) of _______ while the subsidiary reported _______. The subsidiary had bonds payable outstanding on January 1, 2014, with a book value of ______. The parent acquired the bonds on that

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