Reference no: EM131794710
Problem
On July 1, 2013, Killeam Company acquired 76,000 of the outstanding shares of Shaun Company for $18 per share. This acquisition gave Killeam a 25 percent ownership of Shaun and allowed Killeam to significantly influence the investee's decisions.
As of July 1, 2013, the investee had assets with a book value of $4 million and liabilities of $414,400. At the time, Shaun held equipment appraised at $431,200 above book value; it was considered to have a seven-year remaining life with no salvage value. Shaun also held a copyright with a five-year remaining life on its books that was undervalued by $1,160,000. Any remaining excess cost was attributable to goodwill. Depreciation and amortization are computed using the straight-line method. Killeam applies the equity method for its investment in Shaun.
Shaun's policy is to declare and pay a $1 per share cash dividend every April 1 and October 1. Shaun's income, earned evenly throughout each year, was $570,000 in 2013, $604,200 in 2014, and $662,000 in 2015.
In addition, Killearn sold inventory costing $131,400 to Shaun for $219,000 during 2014. Shaun resold $128,000 of this inventory during 2014 and the remaining $91,000 during 2015.
a. Determine the equity income to be recognized by Killeam during each of these years.
b. Compute Killeam's investment in Shaun Company's balance as of December 31, 2015.
|
Write a program to process a bst whose nodes contain
: Write a program to process a BST whose nodes contain characters. The user should be allowed to select from the following menu of options.
|
|
Prepare the property and equipment section of balance sheet
: On January 2, 2016, Perry Company purchased land. Prepare the property, plant, and equipment section of the balance sheet as of December 31, 2016.
|
|
Managers would prefer a budget prepared
: A tool for management to use to penalize managers with poor performance
|
|
What were the important characteristics of the reform
: What were the important characteristics of the reform? What steps did the reform take to improve accounting accuracy?
|
|
Determine the equity income to be recognized by killeam
: Determine the equity income to be recognized by Killeam during each of these years. Compute Killeam's investment in Shaun Company's balance as of December 31.
|
|
Write and test a function member search for searching a bst
: In this section, binary search trees were implemented using pointers, but it also is possible to use an array-based implementation.
|
|
Evaluating the preferred stock required rate of return
: Columbus Pet Products has preferred stock outstanding which pays a dividend of $ 3 at the end of each year. The preferred stock sells for $ 41.22 a share.
|
|
Evaluate management control systems
: Evaluate management control systems and examine their relationship with accounting and planning, including feedback and non-?nancial performance measurements
|
|
Write appropriate declarations for the array-implementation
: Design and test a class for maintaining a storage pool of available nodes, with operations to initialize it, to get a node from it, and to return a node to it.
|