Questions from Financial Reporting

Q: The following is an excerpt from the 2018 Form 10-K

The following is an excerpt from the 2018 Form 10-K of Walgreens Boots Alliance, Inc. (Walgreens). It provides summary income statement data about the companies in which Walgreens has an equity method...

Q: Mills Corporation owns 90% of Morrow Corporation, and there is

Mills Corporation owns 90% of Morrow Corporation, and there is no excess cost associated with Mills ’s investment in Morrow. During 20X1, Mills reported in the income statement in its “Parent Only” fi...

Q: Massie Corporation has an investment in the common stock of Witzmann Corporation

Massie Corporation has an investment in the common stock of Witzmann Corporation. Massie acquired its investment at Witzmann’s book value, so there was no excess cost associated with the investment. I...

Q: Theo Corporation has the following sales and expenses in 20X1, excluding

Theo Corporation has the following sales and expenses in 20X1, excluding any amounts related to its investment in Caratini Corporation. Next to Theo’s amounts are the 20X1 sales and...

Q: Kramden Corporation acquired Norton Company several years ago for $500 million

Kramden Corporation acquired Norton Company several years ago for $500 million. Goodwill of $100 million was recognized on the transaction. Through 20X0, no goodwill impairment charges have been taken...

Q: Cephalon Inc. issued $750 million of zero-coupon convertible

Cephalon Inc. issued $750 million of zero-coupon convertible notes. Because the notes were issued at par, meaning that Cephalon received $750 million cash for the notes, they have a zero yield-to-matu...

Q: The following data pertain to Tyne Company’s investments in marketable equity securities

The following data pertain to Tyne Company’s investments in marketable equity securities. (Assume that all securities were held throughout 20X0 and 20X1.) Required: 1. What amount sh...

Q: Information related to Jones Company’s portfolio of trading securities at December 31

Information related to Jones Company’s portfolio of trading securities at December 31, 20X1, follows: Amortized cost of securities……………………………..$340,000 Gross unrealized gains (cumulative)………………… 8,000...

Q: In January 20X1, Harold Corporation acquired 20% of Otis Company’s

In January 20X1, Harold Corporation acquired 20% of Otis Company’s outstanding common stock for $400,000. This investment gave Harold the ability to exercise significant influence over Otis. The book...

Q: Sage Inc. bought 40% of Adams Corporation’s outstanding common stock

Sage Inc. bought 40% of Adams Corporation’s outstanding common stock on January 2, 20X1, for $400,000. The carrying amount of Adams’s net assets at the purchase date totaled $900,000. Fair values and...