Questions from Financial Accounting

Q: Progeny Corporation owns 75 percent of Spawn Corporation’s voting common stock.

Progeny Corporation owns 75 percent of Spawn Corporation’s voting common stock. Progeny reported income from its separate operations of $90,000 and $110,000 in 20X4 and 20X5, respectively. Spawn repor...

Q: Post Delivery Service acquired at book value 80 percent of the voting

Post Delivery Service acquired at book value 80 percent of the voting shares of Script Real Estate Company. On that date, the fair value of the non controlling interest was equal to 20 percent of Scri...

Q: Pea Company purchased 70 percent of Split Company’s stock approximately 20 years

Pea Company purchased 70 percent of Split Company’s stock approximately 20 years ago. On December 31, 20X8, Pea purchased a building from Split for $300,000. Split had purchased the building on Januar...

Q: Parent Company holds 90 percent of Surrogate Company’s voting common shares.

Parent Company holds 90 percent of Surrogate Company’s voting common shares. On December 31, 20X8, Parent recorded a loss of $16,000 on the sale of equipment to Surrogate. At the time of the sale, the...

Q: Pocket Corporation holds 70 percent of Strap Company’s voting common stock.

Pocket Corporation holds 70 percent of Strap Company’s voting common stock. On January 1, 20X2, Strap paid $300,000 to acquire a building with a 15-year expected economic life. Strap uses straight-lin...

Q: Plumber Corporation owns 60 percent of Socket Corporation’s voting common stock.

Plumber Corporation owns 60 percent of Socket Corporation’s voting common stock. On December 31, 20X4, Plumber paid Socket $276,000 for dump trucks Socket had purchased on January 1,...

Q: Select the correct answer for each of the following questions.

Select the correct answer for each of the following questions. 1. Upper Company holds 60 percent of Lower Company’s voting shares. During the preparation of consolidated financial st...

Q: Passport Manufacturing purchased an ultrasound drilling machine with a remaining 10-

Passport Manufacturing purchased an ultrasound drilling machine with a remaining 10-year economic life from a 70 percent-owned subsidiary for $360,000 on January 1, 20X6. Both companies use straight-l...

Q: Assume the same facts as in E8-7 but prepare entries

Assume the same facts as in E8-7 but prepare entries using straight-line amortization of bond discount or premium. Data from E8-7: Suspect Company issued $600,000 of 9 percent first mortgage bonds o...

Q: Plastic Corporation purchased management consulting services from its 75 percent-owned

Plastic Corporation purchased management consulting services from its 75 percent-owned subsidiary, Spoon Inc. During 20X3, Plastic paid Spoon $123,200 for its services. For the year 20X4, Spoon billed...