Create an Account

Already have account?

Forgot Your Password ?

Home / Questions / On January 3 2011 Haskins Corporation acquired 40 percent of the outstanding common stock ...

On January 3 2011 Haskins Corporation acquired 40 percent of the outstanding common stock of Clem Company for $990000 This acquisition gave Haskins the ability to exercise significant influence

On January 3, 2011, Haskins Corporation acquired 40 percent of the outstanding common stock of
Clem Company for $990,000. This acquisition gave Haskins the ability to exercise significant influence
over the investee. The book value of the acquired shares was $790,000. Any excess cost over
the underlying book value was assigned to a patent that was undervalued on Clem’s balance sheet.
This patent has a remaining useful life of 10 years. For the year ended December 31, 2011, Clem
reported net income of $260,000 and paid cash dividends of $80,000. At December 31, 2011, what
should Haskins report as its investment in Clem under the equity method?

May 22 2020 View more View Less

Answer (Solved)

question Subscribe To Get Solution

Related Questions