Computing income from the investee under equity method

Assignment Help Accounting Basics
Reference no: EM13132092

Lindy Corporation owns a 40% interest in Belair Company, acquired several years ago at a cost equal to book value and fair value. Belair sells merchandise to Lindy for the first time in 2003. In computing income from the investee for 2003 under the equity method, Lindy uses the following equation:

A-40% of Belair's income less 100% of the unrealized profit in Lindy's ending inventory.

B-40% of Belair's income plus 100% of the unrealized profit in Lindy's ending inventory.

C-40% of Belair's income less 40% of the unrealized profit in Lindy's ending inventory.

D-40% of Belair's income plus 40% of the unrealized profit in Lindy's ending inventory.

Reference no: EM13132092

Questions Cloud

Alcohols are less volatile than ethers of the same : Alcohols are less volatile than ethers of the same molecular weight, but the two classes of compounds have approximately the same solubility in water because:
Which scatter plot-graph of least squares regression line : His least squares regression line equation is: "assembly line output" = 1.03 + (5.1389 x Test Score). Which scatter plot has the graph of his line?
Finite math word problems : To pour a concrete sidewalk takes 2 hours of preparation nd 3 hours of finishing. To pour a concrete patio takes 4 hours of preparation and 3 hours of finishing. ABC Concrete Company makes a profit of $450 on a sidewalks and $700 on a patio.
Harley-davidson : Should Children Who Commit Violent Crimes Be Tried As Adults Research Paper Essays and Term Papers
Computing income from the investee under equity method : Lindy Corporation owns a 40% interest in Belair Company, acquired several years ago at a cost equal to book value and fair value. Belair sells merchandise to Lindy for the first time in 2003. In computing income from the investee for 2003 under th..
What is the amount of interest revenue : The PV of $1 at 10% for 3 periods is 0.75. What is the amount of interest revenue that should be included in Abel’s 2013 income statement?
Slope and equation of horizontal line : Find the slope and the equation of the horizontal line that passes through (-325, 185) Find the slope and the equation of the vertical line that passes through (-325, 185) Find the difference quotient of f(x) = 1/x^2
Define borane forms complexes with sulfides and amines : Borane forms complexes with sulfides and amines. Draw a suitable structure to represent the complex formed between BH3 and dimethyl sulfide

Reviews

Write a Review

Accounting Basics Questions & Answers

  Recognizing the amount of revenue

Payment terms were: 50% due on October 1, 1996, 25% due on first delivery and 25% due on the second delivery. What amount of revenue should Acme recognize from this sale during 1996?

  Time interest earned ratio

For the most recent year, Wilson Enterprises had sales of $689,000, cost of goods sold of $470,300, depreciation expense of $61,200, and additions to retained earnings of $48,560.

  External financial reporting

If Rushia Company determines that the fair value of the investment is now $3,900,000 and is using U.S. GAAP for its external financial reporting, which of the following is true?

  How will the development above effect the accounting

What are several possible explanations for the markdown and slow sale of common waleth Edison's bonds?

  Information about gaap

What are Generally Accepted Accounting Principles (GAAP)? How does GAAP affect financial reporting? How does GAAP need to change to accommodate today's dynamic business environment?

  Explain in general terms the accounting treatment

Accounting Homework:   Explain in general terms the accounting treatment to changes in terms of existing loans.  What should be the accounting treatment of the modification to Blueberry's note?

  Journal entries for bond issuance-interest-amortization

Please describe how to prepare necessary journal entries to record the issuance of bonds, the periodic interest, and amortization of bond premiums and discounts.

  Basics of consolidated statements

Emron Company owns a 100% interest in the common stock of the Dietz Company. On January 1, 20X2, Emron sold Dietz a fixed asset that Dietz will use over a 5-year period. The asset was sold at a $5,000 profit. In the consolidated statements, this p..

  Difference between a file oriented and a database system

Bonadio Ekectrical Supplies distributes electrical components to the construction idustry. The company began as a local suookier 15 yrs ago and has rwon rapidly to become a major competitor in the north central US.

  What was the net change in cash

How much cash flow did the company have from Operating, Investing and Financing actvities.

  Prepare the journal entries for the issuance of the bonds

XYZ Company is building a new hockey rink at a cost of $1,500,000. It received a down payment of $500,000 from local businesses in support of the project and now needs to borrow $1,000,000 to complete the project. It therefore decides to issue $1,..

  Determining taxable income rules

In 2012, Warren sold his personal use automobile for a loss of $9,000. He also sold a personal coin collection for a gain of $10,000. As result of these sales, $1,000 is subject to income tax.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd