Business, 29.07.2020 01:01 flyingcerberus1408
On January 2, abc co. purchased 10% of XYZ Co.’s outstanding common stock for $400,000, which equaled the carrying amount and fair value of 10% of XYZ’s net assets. ABC is the largest stockholder in XYZ and ABC has the majority of the seats on XYZ’s board of directors. XYZ reported net income of $500,000 for the current year and paid total cash dividends of $150,000. On its December 31 balance sheet, what amount should ABC report as its investment in XYZ?
A. $450,000.
B. $435,000.
C. $400,000.
D. $385,000.
Answers: 1
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On January 2, abc co. purchased 10% of XYZ Co.’s outstanding common stock for $400,000, which equale...
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