Reference no: EM132623384
Question - On December 31, 2019, Akron, Inc., purchased 5 percent of Zip Company's common shares on the open market in exchange for $16,000. On December 31, 2020, Akron, Inc., acquires an additional 25 percent of Zip Company's outstanding common stock for $95,000.
During the next two years, the following information is available for Zip Company:
Income Dividends Declared Common Stock
Fair Value (12/31)
2019 $320,000
2020 $75,000 $7,000 380,000
2021 88,000 15,000 480,000
At December 31, 2020, Zip reports a net book value of $290,000. Akron attributed any excess of its 30 percent share of Zip's fair over book value to its share of Zip's franchise agreements. The franchise agreements had a remaining life of 10 years at December 31, 2020.
a. Assume Akron applies the equity method to its Investment in Zip account:
1. What amount of equity income should Akron report for 2021?
2. On Akron's December 31, 2021, balance sheet, what amount is reported for the Investment in Zip account?
b. Assume Akron uses fair-value accounting for its Investment in Zip account:
1. What amount of income from its investment in Zip should Akron report for 2021?
2. On Akron's December 31, 2021, balance sheet, what amount is reported for the Investment in Zip account?
|
Find what total amount reported as current liabilities
: On December 31, 2022, what total amount should be reported as non-current liabilities? On December 31, 2022, what total amount should be reported as current
|
|
Has the program gotten away from its original purpose
: Since its inception, the only consistent thing about Medicare is constant change. Discuss your thoughts on the evolution and future of Medicare.
|
|
Prepare the journal entries to record their issuance
: Prepare the journal entries to record their issuance by Universal Foods on January 1, 2021, interest on June 30, 2021 and interest on December 31, 2028
|
|
How has experience or lack of it shaped your view of death
: How often do you engage with or witness death in your work? How has this experience or the lack of it shaped your view of death? Has it gotten easier.
|
|
What amount is reported for the investment in zip account
: On Akron's December 31, 2021, balance sheet, what amount is reported for the Investment in Zip account
|
|
Formalize the four principles and four boxes approach
: This chart will formalize the four principles and four boxes approach and the four-boxes approach by organizing the data from the case study according.
|
|
What is the effective interest rate on the loan
: What is the effective interest rate on the loan if the borrower repays the loan after 72 payments?
|
|
Find what is the apr on the loan
: A company borrows $10,000 at an interest of 8% payable annually? What is the APR on the loan? Explain in detail and Show the proper calculation.
|
|
Find the outstanding balance on the loan
: If she wants to pay off the loan after 8 years, what would be the outstanding balance on the loan?
|